Tomorrow, you could begin doubling your account every single month starting with one letter.
The letter will come from a 20-year trading professional named Ian Cooper. He says, “In 2017, following my trades you would be doubling even tripling your account some months. Let me show you how.”
He will show you exactly what to do... and he’ll give you the blueprint for just $1.
The GPS Buy Write Strategy is a strategy designed to generate profits from selling call option premium. A 'buy write' is established by buying an ETF and 'writing' or selling a related call option. Normally one call option is sold for each 100 shares of an ETF that is purchased. A buy write is also known as a 'covered call' and implementing a covered call trade is also known as 'writing a covered call'. Advantages of buy write trades would include:
Collect cash income in your brokerage account.
Buy ETFs at a discount.
Proved a good profit potential on your discounted ETF purchase.
Provide a downside protection in case the underlying ETF declines in price.
Limited risk trades.
The sale of a call option generates cash income in your brokerage account. One call option contract normally controls one hundred shares of the underlying ETF. When you sell a call option, cash is credited to your brokerage account. For example, if you sell a call option for 5.00 points, $500 will be credited to your account ($5.00 x 100 shares = $500). When you buy an ETF and sell a call option, the cash received from the sale of the call reduces the cost basis of your ETF. This provides downside protection in the event the ETF declines in price.
The goal of the Buy Write strategy is to sell a call option on an ETF that closes at or above the strike price of the short call option at the option expiration. This results in the ETF shares being called and the maximum profit potential being realized for the trade.
To give you an example, I purchased 100 shares of the Brazil ETF (EWZ) at 33.69 and simultaneously sold the Brazil ETF January 40-Strike call option for 7.10 points. This option was to expire about 15 months out.
The Buy Write Analysis below displays the profit potential for buying the EWZ ETF at 33.69 and selling the January 40-Strike call for 7.10 points. The Analysis displays potential profit results for various price changes for the EWZ ETF at option expiration from a 20% increase to a 20% decrease in price.
The cost of this buy write is 26.59 points or $2,659, and is calculated by subtracting the 7.10 points I received from the sale of the 40-Strike call from the 33.69 cost of the ETF purchase. The sale of the 40-Strike call allowed me to buy the EWZ ETF at a discounted price of 26.59.
The Buy Write Analysis reveals that if the EWZ ETF price remains flat at 33.69 at option expiration a 26.7% return will be realized (circled). A 20% increase in price for the EWZ ETF to 40.43 results in a 50.4% return and a 20% decrease in price to 26.5 results in a 1.4% return (circled).
This buy write trade realizes a net profit even if the price of the EWZ ETF decreases 20% at option expiration due to the sale of the 40-Strike call option which profits as the EWZ ETF decreases in price. Profiting on a buy write trade when the price of the ETF decreases in price reduces the risk of the ETF purchase and results in a higher percentage of winning trades.
When you create a buy write trade by purchasing an ETF and selling an option:
The ETF profits if the price of the ETF increases in price.
The call option sold profits if the price of the underlying ETF decreases in price.
You purchase the ETF at a discounted price, which provides downside protection.
In most cases, the buy write can profit if the ETF increases, remains flat or decreases at option expiration.
Your risk is limited to the cost of the buy write.
The preceding Buy Write Analysis for my current EWZ buy write trade demonstrates the attractive profit potential available with low risk for the buy write strategy:
50.4% Return if EWZ is UP 20% at Option Expiration.
26.7% Return if EWZ is FLAT at Option Expiration.
1.4% Return if the EWZ is DOWN 20% at Option Expiration.
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