Trade Alert - (NEM) September 5, 2017
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 - (NEM) TAKE PROFITS
SELL the Newmont Mining (NEM) October, 2017 $32-$34 in-the-money vertical BULL CALL spread at $1.95 or best
Closing Trade
9-15-2017- NOT FOR NEW SUBSCRIBERS
expiration date: October 20, 2017
Portfolio weighting: 10%
Number of Contracts = 59 contracts
Using this morning's prices, we can now reap 84.37% of the maximum potential profit. The remaining five cents of the position is time value until the October 20 options expiration day.
We earned a 16.07% on this trade in only 7 trading days in this position.
As I expected, Newmont Mining conducted a major breakout two weeks ago, and blasted through to a new 2017 high.
This was a bet that the (NEM) wouldn't move below $34 over the 40 trading days, compared to the then current $36.97.
As I write this, the (NEM) is trading at $39.09, or up 5.73%.
If you didn't do options and bought the (NEM) outright, keep them. I think the prospects for the shares of gold and silver mining companies for the rest of 2017 are excellent.
To see how to enter this trade in your online platform, please look at the order ticket below, which I pulled off of Interactive Brokers.
If you are uncertain on how to execute an options spread, please watch my training video on How to Execute a Vertical Bull Call Spread
http://members.
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. If it doesn't get done, then bump up your bid for the spread by a few cents.
The difference between the bid and the offer on these deep in-the-money spread trades can be enormous. You are trying to buy your own yacht with this trade, not your broker's.
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.
Here are the specific trades you need to execute this position:
Sell 59 October, 2017 (NEM) $32 calls at.....................................$6.80
Buy to cover short 59 October, 2017 (NEM) $34 calls at....................$4.85
Net Proceeds:......................................................................................$1.95
Profit: $1.95 - $1.68 = $0.27
(59 X 100 X $0.27) = $1,593 or 16.07% in 7 trading days.
