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.
Trade Alert – (FXE) Calls
Expiration of Sell the Currency Shares Euro Trust (FXE) May, 2012 $132 Calls at zero
expiration date: May 18, 2012
Portfolio weighting: 20% = 50 Contracts
The collapse of the Euro caused by the latest political crisis in Europe allowed our short position in the Currency Shares Euro Trust (FXE) May, 2012 $132 Calls to expire worthless. This was the easiest trade of the year. To me, the outcome of the French presidential election, and its broader geopolitical implications, was a no brainer months ago. It allowed us to mitigate the modest losses we saw in the offsetting short position in the May, $127 puts. It also cancelled out the time decay that kicked in on our long position in the June $130 puts. So it performed as expected.
The profit on the trade amounts to (50 X 100 X $0.19) = $950, or 0.95% for the model $100,000 portfolio. The position should disappear from you statement on Monday and the Margin freed up.