Email Campaign Archive

OPTIONSMART MORNING UPDATE: Soared on strong consumer confidence reading

1. OUTLOOK:   Much stronger than expected consumer confidence data offset weak housing report and encouraged investors to jump back into the market after several down days. The rally was broad-based. However, this was just one number. We will have more important economic reports later this week. Apple rose 6% after analysts at Morgan Stanley upgraded the iPhone maker's stock. QQQQ's implied volatility dropped as large traders dumped put options and bet on an upswing. The market has more room to move higher this week.

2.  OUR OPTION REPAIR TECHNIQUE: ROLLING SPREADS No one can predict the direction of stock prices with 100% likelihood. That's why you need a backup plan to avoid losses. Rolling is a great technique to use when you want to hang onto a position you believe in. Rolling a spread refers to the process of closing both legs of an existing spread, and then opening two legs of a new spread using an option of the same type (call or put) at a different, typically more distant, expiration date and/or different strikes.

Here is a recent example from the "QQQQ Picks" Track record:

The chart above shows how did we repair the spread in early March by rolling the spread into April and paying extra 0.36.

We found this roll reasonable because the general trend was up.

This technique works very good in almost any market environment. This advanced technique is a powerful toll to reduce risk for our portfolios. Learn more about our QQQQ Picks!  Take advantage of our special offer below!

5. WISDOM NUGGETS: Do not buy a stock because it is low priced (or sell because the price is high). 

6. SPECIAL OFFER: N/a

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