Trade Alert - (DAL) October 20, 2014
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 - (DAL)
Sell the Delta Airlines (DAL) November, 2014 $25-$27 in-the-money vertical bull call spread at $1.90 or best
Closing Trade
10-20-2014
expiration date: November 21, 2014
Portfolio weighting: 10%
Number of Contracts = 63 contracts
Got 75% of the potential profit here in 2 days. Let?s take it!
Delta Airlines (DAL) has just seen its cost of fuel, its largest single expense, drop by 25%. What has the stock done? Fallen 30%, mostly thanks to the Ebola virus.
Is there something wrong with this picture?
You can sell this spread anywhere in a $1.85-$1.95 range and have a reasonable expectation of making good money on this trade. The upper strike is 10% below today?s low.
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 63 November, 2014 (DAL) $25 calls at?????$10.40
Buy to cover short 63 November, 2014 (DAL) $27 calls at..$8.50
Net Proceeds:??????????????????.....$1.90
Profit: $1.90 - $1.60 = $0.30
(63 X 100 X $0.30) = $1,890 or 1.89% profit for the notional $100,000 portfolio.
?
