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 (JPM) March 2021 $135-$140 in-the-money vertical Bull Call spread at $4.00 or best
Opening Trade
3-4-2021
expiration date: March 19, 2021
Portfolio weighting: 10%
Number of Contracts = 24 contracts
If you don’t do options, buy the stock. My target for (JPM) this year is $200, up 35%.
The Volatility Index (VIX) is back up to a sky-high $32, so it’s party time again!
You can thank Jay Powell, who laid an egg today, stating that inflation may make a temporary return. He is only stating the obvious, as we already know that copper and lumber prices have doubled in the past year.
This is no “black swan” but the market thinks it is, at least for today.
I told you I’d be back in this name.
This has pushed the Volatility Index (VIX) up to a sky-high $38, which has the effect of vastly overvaluing stock options. This is a gift for traders like us.
In addition, my own Mad Hedge Market Timing Index has moved back into “BUY” territory with a heart-stopping 25-point swan dive, from 66 to at 41. This is the lowest level on months.
I am therefore buying the JP Morgan (JPM) March 2021 $135-$140 in-the-money vertical Bull Call spread at $4.00 or best
Don’t pay more than $4.50 or you’ll be chasing.
That has given us a gift. (JPM) is the class act in the global banking sector, and CEO Jamie Diamond is the best CEO in the country.
I believe that massive government borrowing and spending will drive US interest rates up through the roof and the value of the US dollar (UUP) down. Banks love high interest rates because they vastly improve profit margins.
This is a bet that JP Morgan (JPM) will not fall below $140 by the March 19 option expiration day in 11 trading days.
Here are the specific trades you need to execute this position:
Buy 24 March 2021 (JPM) $135 calls at………….…….…$15.00
Sell short 24 March 2021 (JPM) $140 calls at………....$11.00
Net Cost:……………………..…….…….......…..………….….....$4.00
Potential Profit: $5.00 - $4.00 = $1.00
(24 X 100 X $1.00) = $2,400 or 25.00% in 11 trading days.
If you are uncertain on 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.
