While our high-flying, short-term stocks get most of the attention, it takes away from an aspect of our trading that is just as responsible for our massive growth.
While this makes sense – everyone loves a quick 50% gain – it’s important that we remain disciplined and keep diversified.
• Having trades built on this philosophy provides the bridge between your speculative plays and your longer termed goals.
• This is also often the difference between average gains and massive, monster gains.
• Speculative plays are important. But without the other half of the puzzle most gains are just average.
Here’s a real-world example of how we forward layer our trades and capitalize on rotations.
Let’s use a $250,000 portfolio as an example. First we identified a sector rotation in banks.
WE like banks going forward because we see some of the past headwinds subsiding. In particular, we see an interest rate hike by year’s end.
So we allocated 30% to this play, or about $7500.
We found two banks that we really like and we decided to go with them.
The first was Bank of America (BAC)
The other Huntington Bancshares (HBAN)
We allocated $45,000 (60%) to BAC January Call options and $25,000 to Huntington Bancshares January call options.
As of the time of this article, the BAC options are up 42% and the HBAN up 16%. That adds an unrealized gain of $22,500 total.
As you can see, in just a few short weeks we have already added $22,500 to the total value (orange bar) for total value of $272,500.
And when you compound those returns you have a $780,000 portfolio by years-end!! And that’s just one well-executed plan!
We have identified another sector and are currently making the same moves. Don’t be left behind! Remember, speculative plays can be dangerous.
No portfolio should be 100% speculative plays. And this example is exactly why.
We “layer” trades based on future projections to capitalize on massive moves.
** We identify sector rotations
** We position ourselves with strong call options plays
** We focus on strong companies with the highest growth potential
** We focus on companies that have the most to gain from sector rotation
If you enjoyed this report or found some value in it, please check back for more great information. Also, be sure to check out our Facebook page @ http://www.facebook.com/financialreboot or Text the word “Review” to (760) 254-0003 and setup an free consultation!
The Financial Reboot Investment Team