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) – Stop loss
Sell the SPDR S&P 500 (SPY) April, 2013 $158-$161 Put spread at $1.78 or best
Portfolio weighting: Take from 10% to 0%
Number of Contracts = 39 contracts
Unbelievable market. Japan’s ultra quantitative easing is pouring into US stocks. I thought we had this trade after last Friday’s terrible jobs figures. This kind of move only happens once a decade. Time to bail and live to fight another day.
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:
Sell 39 April, 2013 (SPY) $161 puts at……………$2.64
Buy to cover Short 39 April, 2013 (SPY) $158 puts at.…….$0.86
Loss: $2.59 - $1.78 = $0.81
($0.81 X 100 X 39) = $3,159 =3.16% for the notional $100,000 model portfolio.