When a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what security to buy, 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 - (VXX)- BUY
BUY the iPath S&P 500 VIX (VXX) May, 2017 $13.00-$13.50 in-the-money vertical bull call spread at $0.41 or best
Expiration Date: May 19, 2017
Portfolio Weighting: 10%
Number of Contracts = 263 contracts
Buy sun hats when it’s pouring rain and umbrellas in the baking heat of summer.
I am willing to make a bet that the Volatility Index (VIX) is bottoming here at the $9 handle, right at a decade low.
You can pay up to $0.45 and this trade still makes sense.
If you can’t do options, just buy the VXX outright for a quick trade.
A whole host of technical indicators are indicating that risk in the stock market is high.
The Q1 GDP print at 0.70% is a huge disappointment.
Volatility is oversold in the extreme.
The other attraction to this position is that there are only eight days left until expiration.
It also acts as a “RISK OFF” hedge for other long positions we may add in the future.
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 about how to execute this options spread, please watch my training video “How to Execute a Vertical Bull Call Spread”.
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 with only eight days to expiration.
Please keep in mind these are ballpark prices at best. After the text alerts go out, prices can be all over the map. There is no telling how much the market will have moved by the time you get this email.
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Here Are the Specific Trades You Need to Execute This Position:
Buy 263 May, 2017 VXX $13.00 calls at…….….……$1.00
Sell short 263 May, 2017 VXX $13.50 calls at……….$0.59
Potential Profit: $0.50 - $0.41 = $0.09
(263 X 100 X $0.09) = $2,367 or 21.95% profit in eight trading days