Trade Alert - (SPY) June 5, 2015
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 - (SPY)- BUY
Buy the S&P 500 SPDR?s (SPY) June, 2015 $201-$204 in-the-money vertical bull call spread at $2.65 or best
Opening Trade
6-5-2015
expiration date: June 19, 2015
Portfolio weighting: 10%
Number of Contracts = 43 contracts
This is your last chance to get the June options off, which will expire in only 10 trading days.
You can pay all the way up to $2.75 for this spread and it still makes sense. If you can?t do the options, stand aside, don?t do it. There is not enough room for a long only play here.
I think the market will continue to grind sideways through the current summer. If we go up, it will be a slow climb of a wall of worry. We are not going to crash in the next two weeks, the only way you can lose money on this position.
This spread combination allows for the S&P 500 to fall 10 points, or 4.7% from the recent high and still keep your entire profit.
The breakeven point of this trade is an expiration print of $203.65 at the June 19 expiration. If we trade down there before then, stop out and take a small loss.
Sideways, then up. That is the short version.
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.
If the price of this spread has moved more than 5% by the time you receive this Trade Alert, don?t chase it. Wait for the next one. There are plenty of fish in the sea.
Here are the specific trades you need to execute this position:
Buy 43 June, 2015 (SPY) $201 Calls at?????$9.10
Sell short 43 June, 2015 (SPY) $204 Calls at..?$6.45
Net Cost:??????????????????.....$2.65
Potential Profit: $3.00 - $2.65 = $0.35
(43 X 100 X $0.35) = $1,505 or 1.50% profit for the notional $100,000 portfolio.
