• support@madhedgefundtrader.com
  • Member Login
Mad Hedge Fund Trader
  • Home
  • About
  • Store
  • Luncheons
  • Testimonials
  • Contact Us
  • Click to open the search input field Click to open the search input field Search
  • Menu Menu

Follow Up to Trade Alert - (GLD) May 16, 2013

Trade Alert

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.

Further Explanation to: Trade Alert - (GLD)

Buy the SPDR Gold Trust Shares (GLD) June, 2013 $120-$125 call spread at $4.45 or best

Opening Trade

5-16-2013

expiration date: 6-21-2013

Portfolio weighting: 10%

Number of Contracts = 23 contracts.

I want to take advantage of the $100 swoon on the price of gold since we put on our SPDR Gold Trust Shares June, 2013 $150-$155 in-the-money bear put spread.

George Soros has just finished dumping his massive position in the yellow metal, which clearly accounted for a big part of the drop. In the meantime, long term value players, like Omega?s Leon Cooperman, have started scaling in on the long side. So the market may reach some sort of rough balance in the near future.

Gold?s trouble?s are anything but over in this yield hungry world. I am now hearing of some extreme forecasts of a downside target of $500, which involve the entire unwinding of the six-year bull move. But with the margin calls now out of the way, the dramatic $100 intra day moves are gone for the time being.

The SPDR Gold Trust Shares (GLD) June, 2013 $120-$125 deep-in-the-money bull call spread gives me a cushion of $92 on the downside and still make the maximum profit. I also still have a bigger $180 cushion on my existing (GLD) June, 2013 $150-$155 put spread. I only need the market to settle down for four weeks to coin it on both positions. The elevated implied volatilities on (GLD) puts make these deep-out-of-the money positions profitable. This is a rare event.

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 further out.

Here are the specific trades you need to execute this position:

Buy 23 June, 2013 (GLD) $120 calls at?????$15.00
Sell Short 23 June, 2013 (GLD) $125 calls at.??.$10.55
Net Cost:????????????....??..?....$4.45

Potential Profit at expiration: $5.00 - $4.45 = $0.55

($0.55 X 100 X 23) = $1,265 ? 1.27% for the notional $100,000 model portfolio.

GLD 5-16-13

Gold Nuggets You Can Only Fall So Far So Fast

Share this entry
  • Share on Facebook
  • Share on X
  • Share on WhatsApp
  • Share on Pinterest
  • Share on LinkedIn
  • Share by Mail
https://www.madhedgefundtrader.com/wp-content/uploads/2013/04/Gold-Nuggets.jpg 414 617 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2013-05-16 17:03:332013-05-16 17:03:33Follow Up to Trade Alert - (GLD) May 16, 2013

tastytrade, Inc. (“tastytrade”) has entered into a Marketing Agreement with Mad Hedge Fund Trader (“Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’s brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade and/or any of its affiliated companies. Neither tastytrade nor any of its affiliated companies is responsible for the privacy practices of Marketing Agent or this website. tastytrade does not warrant the accuracy or content of the products or services offered by Marketing Agent or this website. Marketing Agent is independent and is not an affiliate of tastytrade. 

Legal Disclaimer

There is a very high degree of risk involved in trading. Past results are not indicative of future returns. MadHedgeFundTrader.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles and all other features are for educational purposes only and should not be construed as investment advice. Information for futures trading observations are obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the information. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein. Affiliates of MadHedgeFundTrader.com may have a position or effect transactions in the securities described herein (or options thereon) and/or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies.

Copyright © 2025. Mad Hedge Fund Trader. All Rights Reserved. support@madhedgefundtrader.com
  • Privacy Policy
  • Disclaimer
  • FAQ
Link to: Trade Alert - (GLD) May 16, 2013 Link to: Trade Alert - (GLD) May 16, 2013 Trade Alert - (GLD) May 16, 2013 Link to: May 17, 2013 - Quote of the Day Link to: May 17, 2013 - Quote of the Day May 17, 2013 - Quote of the Day
Scroll to top