Trade Alert - (SPY) Expiration November 24, 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.
Trade Alert - (SPY) - EXPIRATION
Expiration of the S&P 500 (SPY) November, 2014 $179-$183 in-the-money vertical bull call spread at $4.00
Closing Trade ? NOT FOR NEW SUBSCRIBERS!
11-21-2014
expiration date: November 21, 2014
Portfolio weighting: 10%
Number of Contracts = 32 contracts
My call that the October 15 capitulation was the bottom of the correction proved true. I knew there was just too much cash sitting on the sidelines with anxious, underperforming portfolio managers to allow the market to fall any further.
Those who bought the S&P 500 (SPY) November, 2014 $179-$183 in-the-money vertical bull call spread at $3.55 saw there position expire on Friday at its maximum potential value of $4.00. That is a profit of 12.7% in little more than a month.
Those who bought only the S&P 500 $179 calls, or bought the (SPY) outright, made infinitely more money. Thank you for the many emails of appreciation for this trade.
We got an assist from one of the most ferocious stock market rallies in history. Despite all of the violence in the markets, the volatility of our vertical call spread remained muted, and our capital at risk limited, as it is supposed to.
It also helped that ten year Treasury bond yields collapsed from 1.86% to 2.39%, which is always beneficial for financial shares.
Your broker should credit the full profit for this position in you account this morning, and release the margin requirement. If they don?t, you should get on the phone immediately.
The next thing to do is pat yourself on the back for a trade well done, and then figure out how to spend the money. I wish they were all this easy.
For new subscribers who haven?t seen a winner yet, be patient. Your turn will come.
On to the next trade.
Here are the specific prices you can use this position:
Long 32 November, 2014 (SPY) $179 calls at?????$27.68
Short 32 November, 2014 (SPY) $183 calls at??..??.$23.68
Net Cost:????????????????..??.....$4.00
Profit at expiration: $4.00 - $3.55 = $0.45
(32 X 100 X $0.45) = $1,440 or 1.44% profit for the notional $100,000 portfolio.
