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)
Sell the SPDR S&P 500 (SPY) March, 2013 $155-$158 bear put spread at $2.70 or best
expiration date: 3-15-2013
Portfolio weighting: 20%
Number of Contracts = 74 contracts
Time to stop out at cost. With eight trading days to go until expiration, we are getting too close to the money to risk an upside breakout. We are swimming in profits in all our other positions, so it is time to control some risk here.
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.
Here are the specific trades you need to execute this position:
Buy 74 March, 2013 (SPY) $158 puts at……………$4.77
Sell short 74 March, 2013 (SPY) $155 puts at …….$2.05
profit: $2.72 – $2.70 = $0.02
($0.02 X 100 X 74) = $148, or .15% for the notional $100,000 model portfolio.