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.
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Trade Alert - (TLT)- BUY
BUY the iShares Barclays 20+ Year Treasury Bond Fund (TLT) October, 2016 $141-$144 in-the-money vertical bear PUT spread at $2.67 or best
Opening Trade
9-23-2016
Expiration Date: October 21, 2016
Portfolio Weighting: 10%
Number of Contracts = 37 contracts
YOU CAN PAY UP TO $2.80 FOR THIS POSITION AND IT STILL MAKES SENSE.
The Fed has come and gone, with no move to raise interest rates, as I expected.
However they did give a very strong indication of a rate rise at the December 13-14 meeting.
So I am certain that the highs are in for bond prices and the lows for yields.
If we get a head of steam on this move, ten year treasury bond yields could hit 2.00%, up from today?s 1.61%.
That means you want to sell every four-point bond rally, of which we have one this morning.
If you can?t trade options, buy the ProShares Ultra Short Treasury Bond Fund ETF (TBT). We could be on some kind of sustainable trend here.
To see how to enter this trade in your online platform, please look at the order ticket below, which I pulled off of optionshouse.
If you are uncertain on how to execute an options spread, please watch my training video on ?How to Execute a Vertical Bear Put Spread? by clicking https://www.madhedgefundtrader.com/ltt-vbpds/
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. Spread pricing can be very volatile on expiration months farther out.
Here are the specific trades you need to execute this position:
Buy 37 October, 2016 (TLT) $144 puts at????.???$7.60
Sell short 37 October, 2016 (TLT) $141 puts at..????.$4.93
Net Cost:????????????????..??.?.....$2.67
Potential Profit: $3.00 - $2.67 = $0.33
(37 X 100 X $0.33) = $1,221 or 12.36% profit over the next 19 trading days.
