When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.
Trade Alert - (JPM) – BUY
BUY the JP Morgan Chase (JPM) August 2024 $190-$195 in-the-money vertical Bull Call spread at $4.40 or best
Opening Trade
7-18-2024
expiration date: August 16, 2024
Portfolio weighting: 10%
Number of Contracts = 25 contracts
I am writing this to you from the British Airways first-class lounge at London’s Heathrow Airport.
We have a handy little 3% drop in JP Morgan Chase shares to give us a small window to get into this trade this morning.
If you don’t do options, buy the stock. My target for (JPM) this year is $250, up 23%.
(JPM) is the top commercial bank in the US, with a market capitalization of $598 billion. They are also one of the most profitable. Yet they sport a price-earnings multiple of only 11.7X. They have far and away one of the most sophisticated and conservative risk control procedures out there.
The Fed will certainly raise interest rates by 25 basis this September because it is already in the mail. I did a LEAPS on (JPM) last year and followers earned a handy 100% return in nine months. I like returning to wells that refresh me.
After that, there will be no interest rate rises for a decade. That’s when the economic data catch up with the reality that is happening right now, which is hugely deflationary.
I am therefore buying the JP Morgan Chase (JPM) August 2024 $190-$195 in-the-money vertical Bull Call spread at $4.40 or best.
Don’t pay more than $4.70 or you’ll be chasing.
DO NOT USE MARKET ORDERS UNDER ANY CIRCUMSTANCES.
Simply enter your limit order, wait five minutes, and if you don’t get done, cancel your order and increase your bid by 5 cents with a second order.
This is a bet that JP Morgan will not fall below $195 by the August 16 option expiration day in 22 trading days.
For more about (IBKR), please click here for their website.
Here are the specific trades you need to execute this position:
Buy 25 August 2024 (JPM) $190 calls at………….………$21.00
Sell short 25 August 2024 (JPM) $195 calls at………....$16.60
Net Cost:……………………..…….………..………….….............$4.40
Potential Profit: $5.00 - $4.40 = $0.60
(25 X 100 X $0.60) = $1,500 or 13.63% in 22 trading days.
If you are uncertain about how to execute an options spread, please watch my training video by clicking 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. Spread pricing can be very volatile on expiration months farther out.
Keep in mind that these are ballpark prices at best. After the alerts go out, prices can be all over the map.
