As a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what should be bought, when to buy it, and at what price. This is your chance to ?look over? John Thomas? shoulder as he gives you unparalleled insight on major world financial trends BEFORE they happen.
Trade Alert - (SPY)
Buy the S&P 500 (SPY) October, 2014 $180-$184 in-the-money vertical bull call spread at $3.64 or best
Opening Trade
10-14-2014
expiration date: October 17, 2014
Portfolio weighting: 10%
Number of Contracts = 27 contracts
No, this is not a typo! These options expire in 3 days! And the (SPY) has to drop more than 4 full points for you to lose money on this position.
This is because volatility is so high, that the prices for the short call element have gone through the roof. You can now reap in three days in premium what it took a month to take in during the summer.
You can buy this spread anywhere in a $3.60 - $3.75 range and have a reasonable expectation of making good money on this trade.
The best execution can be had by placing your bid for the entire spread in the middle market and waiting for the market to come to you. The difference between the bid and the offer on these deep in-the-money spread trades can be enormous.
Don?t execute the legs individually or you will end up losing much of your profit.
Keep in mind that these are ballpark prices only. Spread pricing can be very volatile on expiration months farther out.
Here are the specific trades you need to execute this position:
Buy 27 October, 2014 (SPY) $180 calls at?????$8.29
Sell short 27 October, 2014 (SPY) $184 calls at..??.$4.65
Net Cost:??????????????????.....$3.64
Potential Profit at expiration: $4.00 - $3.64 = $0.36
(27 X 100 X $0.36) = $972 or 0.97% profit for the notional $100,000 portfolio.
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