New Year, New Profits

Dear New Money Club Member,

We’re kicking off 2021 with a BANG!

You know what they say … out with the old and in with the new. I’m excited about the opportunities we’re going to see in 2021.

Sure, emotions and the noise are at an extreme. But we’ll block that out and focus on the signals.

Now, the CBOE Volatility Index (VIX), aka the “fear” index, is still above our key 15 levels, trading at 21. That means we’re going to see quick sell-offs like the one in Monday’s session.

That’s why it’s important to manage our winning trades, which is what we did this week.

Portfolio Update

On Tuesday, we issued an alert to:

Buy to Open the Dana Incorporated (NYSE: DAN) Feb. 19, 2021, $21/$23 call vertical up to $0.70 per contract or better, for the day.

On Wednesday, we elected to:

Sell to Close that DAN call vertical at the market.

Buy to Open Altria Group, Inc. (NYSE: MO) Jan. 29, 2021, $43 calls (MO210129C00043000) up to $0.61 per contract or better, for the day.

And on Thursday, we chose to:

Sell to Close Tower Semiconductor Ltd.  (Nasdaq: TSEM) Jan. 15, 2021, $28 calls (TSEM210115C00028000) at the market.

That means right now, we’re holding:

  • Sandstorm Gold Ltd. (NYSE: SAND) Jan. 15, 2021, $10 calls (SAND210115C00010000).
  • Axalta Coating Systems Ltd. (NYSE: AXTA) Jan. 15, 2021, $32 calls (AXTA210115C00032000).
  • Altria Group Inc. (NYSE: MO) Jan. 29, 2021, $43 calls (MO210129C00043000).
  • Cloudera Inc. (Nasdaq: CLDR) Jan. 22, 2021, $15 calls (CLDR210122C00015000).
  • Coty Inc. (NYSE: COTY) Jan. 22, 2021, $8 calls (COTY210122C00008000).

After-Action Report

This is our debriefing of every trade we closed — or ones that expired. It’s where we analyze what happened, why it happened and how it can be done better … sort of like what the military uses after missions.

Dana Incorporated (NYSE: DAN) Feb. 19, 2021, $21/$23 call vertical

Date: January 5, 2021

Reason: Our system triggered a bullish signal after a $20 million New Money bet, which is a 4,500% surge in new call options purchased.

Outcome: 46% gain.

Notes: Options are a great tool because we can reduce our risk and also be more strategic. Because of the sharp pullback, volatility was elevated. Even if we were right on direction, implied volatility typically comes in. By using a call vertical, the short strike would help offset that loss. Unfortunately, not everyone was able to take advantage of this trade because their brokerage didn’t approve them for level II trading. That falls on me for not having everyone prepared. But don’t let it get you down. I’ll make it up!

Tower Semiconductor Ltd.  (Nasdaq: TSEM) Jan. 15, 2021, $28 calls (TSEM210115C00028000)

Date: December 28, 2020

Reason: Our system triggered a bullish signal after a fresh $65 million New Money bet, which is a 600% surge in new call options purchased.

Outcome: 16% gain.

Notes: We played this perfectly by selling into a big move yesterday. Some of you reported that you exited at much higher prices, so congratulations!

Now, let’s keep focused and let the market come to us. And, as always, I’ll be keeping you updated every step of the way.

Have a great weekend, and I’ll have a new trade for you on Monday.

To your wealth, freedom and options!

Joshua M. Belanger

New Money Club