This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.
TD Ameritrade (AMTD): A Stable and Consistent Player
Several analysts have a bullish outlook for TD Ameritrade, here are two of them: TD Ameritrade Rating Reiterated by Goldman Sachs Group and TD Ameritrade PT Raised to $61.00
AMTD faced some volatile price action in February as the global equity markets fell under pressure and broadly corrected lower. In the past week, AMTD broke to a fresh 19 year high prior to pulling back. The bullish break is suggesting the stock has resumed higher within its broader uptrend while the pullback offers an entry point against support from the 20-period daily moving average.
AMTD Chart March 2018
If you agree there’s further upside ahead for TD Ameritrade, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.
Buy To Open AMTD 6APR18 54.5 Puts (AMTD180406P54.5)
Sell To Open AMTD 6APR18 57.5 Puts (AMTD180406P57.5) for a credit of $0.98 (selling a vertical)
This price was $0.02 less than the mid-point of the option spread when AMTD was trading near $57.50. Unless the stock rallies quickly from here, you should be able to get close to this amount.
If you use our favorite broker for this trade, tastyworks, your commission on this trade will only be $1 per opening contract ($2 per spread) (and there is no commission on closing trades, only the $.10 clearing fee). Each contract would then yield $0.96 and your broker would charge a $210 maintenance fee, making your investment $110 ($206 – $96). If AMTD closes at any price above $57.50 on April 6, both options would expire worthless, and your return on the spread would be 52% (597% annualized).
Changes to Investor’s Business Daily (IBD) Top 50 This Week:
IBD Underlying Updates March 1, 2018
We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.
As with all investments, you should only make option trades with money that you can truly afford to lose.
Click Here For Original Source Of The Article
If you will live like no one else, later you can live like no one else. Build up your money muscles with America's favorite finance coach. Okay, folks, do you want to turn those fat and flabby expenses into a well-toned budget? Do you want to... read more
From the best-selling author of Saving Capitalism and The Work of Nations, a passionate, clear-eyed manifesto on why we must restore the idea of the common good to the center of our economics and politics.With the warmth and lucidity that hav... read more
Written by a practicing emergency physician, The White Coat Investor is a high-yield manual that specifically deals with the financial issues facing medical students, residents, physicians, dentists, and similar high-income professionals... read more
The Flipping Blueprint is just what the title says, a blueprint on how to flip houses. Everything you need to begin or continue your journey in real estate investing is here. How to present yourself to other real estate professionals, where t... read more
Achieve the Champion Mindset for Peak Performance with this Amazon Best-SellerReach New Levels of Success and Mental Toughness with this Ultimate GuideLearn the "Science of Success" - Step by Step - and Prepare to Excel In this concise and hi... read more
Top-performing mega real estate agent Karen Briscoe's Real Estate Success in 5 Minutes a Day shows that you truly only have to invest five minutes a day to achieve a higher level of success in business and life. Hal Elrod, #1 bestselling aut... read more
Bar Rescue's Jon Taffer presents a new guide to getting what you want in life and business--to stop making excuses so you can get back to winning.During his many years as an entrepreneur, consultant, and star of the Paramount Network's hit s... read more
What if you could get in front of millions of prospects with the avid endorsement of famous influencers--without spending a dime?It's happening right in front of you every day. Guest experts on TV, radio, podcasts, blogs, and live streaming a... read more
Discover The Easiest Way To Achieve Financial Freedom By Investing In Commercial Real EstateJames Dawson shares with you his proven, step-by-step blueprint that could allow anyone - including you – to generate a life-changing income from comm... read more
A timely and Completely New, companion book embracing traditional values is now available... The new title is: Richer Than A Millionaire ~ A Pathway to True Prosperity~~~Enter the new title and get your copy today!~~~~~~~~~The bestselling The... read more