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Trade Alert – (XME) February 22, 2021 – BUY

Trade Alert

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.


Alert

 

Trade Alert – (XME) – BUY

BUY the S&P SPDR Metals & Mining ETF (XME) March 2021 $31-$34 in-the-money vertical Bull Call spread at $2.60 or best

Opening Trade

2-22-2021

expiration date: March 19, 2021

Portfolio weighting: 10%

Number of Contracts = 38 contracts

If you don’t do options, buy the stock. My target for (XME) this year is $60.

The metals have been on a tear all year and will continue to do so. With a global economic boom only months away, shortages will develop everywhere. China, the first into the pandemic and the first out, has shown us the way: pedal to the metal, full speed ahead at 100 miles per hour.

Add that on top of a Biden infrastructure budget in a few months, which will demand loads of metals,  and it is off to the races.

I am therefore buying the S&P SPDR Metals & Mining ETF (XME) March 2021 $31-$34 in-the-money vertical Bull Call spread at $2.60 or best.

Don’t pay more than $2.80 or you’ll be chasing.

These sector ETFs are somewhat illiquid, so just put in a bid and hope for the best.

This is a bet that the (XME) will not fall below $34 by the March 19 option expiration day in 19 trading days.

Here are the specific trades you need to enter this position:

Buy 38 March 2021 (XME) $31 calls at……….………………$6.80

Sell short 38 March 2021 (XME) $34 calls at……..……….$4.20

Net Cost:……………………………..…….………..………….……..$2.60

Potential Profit: $3.00 – $2.60 = $0.40

(38 X 100 X $0.40) = $1,520 or 15.38% in 19 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.

 

And She Only Had a Leaner’s Permit

 

February 22, 2021/by Mad Hedge Fund Trader
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https://www.madhedgefundtrader.com/wp-content/uploads/2016/02/Alert-e1457452190575.jpg 135 150 Mad Hedge Fund Trader https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png Mad Hedge Fund Trader2021-02-22 10:55:412021-02-22 10:55:41Trade Alert - (XME) February 22, 2021 - BUY

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February 22, 2021 February 22, 2021 – Quote of the Day
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