There's no doubt that Apple Inc. (Nasdaq: AAPL) is a fantastic long-term hold. Its growth prospects are excellent, and it will hit $200 a share on its way to being the world's first trillion-dollar company.
That will be great for shareholders when it happens, but it's going to take more than a year to hit those milestones.
But I'm going to show you an easy-to-make trade that made my Money Calendar Alert Members as much as 175% in the 11 days it took shareholders to book just 2.46%.
That's right - a play like this can bring you triple-digit runaway gains in mere days, all while the stock moves just a few points.
Here's exactly how we did it...
Wall Street Missed This
Apple is an essential holding for growth investors. It's got proven performance and uncommon potential.
Here's how it's performed during this earnings season - the most profitable time of year for traders like me.
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This chart hints at our Apple trading strategy.
You see, those holding Apple have done well, but options traders have benefitted even more.
Some have even made it a habit of trading Apple daily - maybe we could even say an Apple trade a day keeps losses at bay - but being nimble and ready to trade support and resistance and other really short technical patterns or signals is in their best interest.
Now, it's important to note right now that I am not here to make a day trader out of you. Day trading is fine, but I can't recommend it for beginners or even intermediate investors. Even for advanced traders, it takes nerve and skill to make day trading pay off over the long term, and we should never "trade over our heads" or our comfort level.
With that said, here's how our Apple trade set up on July 9.
How We Made the Trade
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On July 9, my Money Calendar showed a simple long call (or buy call) option trade with AAPL shares.
The option trade was simply to buy the AAPL Aug 2015 $130 calls (AAPL150821C00130000), which were filled at 2 points. Our profit target at that time was 100%, or 4 points.
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Now... take a look at what happened to Apple from the start date, July 9, through to July 20, when my 100% target on the option was hit. A pretty nice price run on AAPL, I'd say.
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But it was about to get even better...
You see, on the morning of July 20, Apple opened up higher, and the options opened at $4.45, offering us a 122.5% gain.
And the chart below shows where the options were at the close of the day, upwards of $5.40. Intraday they were even a bit higher; I saw them at one time priced at $5.50, which would have been a 175% gainer for those who got that price.
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So, as our newly coined proverb goes, an AAPL a day... And the best part is that we booked these gains just before Apple's earnings put downward pressure on the shares.
A nice profit and a timely exit.
This Ends Monday... Tom's "Money Calendar" alerts him to trades just like the one you just saw all the time. Ninety-nine percent of investors can miss these, but his Money Calendar Alert readers have a direct pipeline to these "Payout Appointments," allowing them to schedule them just like a daily planner. Learn more about Tom's Money Calendar Alert here, before the Monday deadline...
About the Author
Tom Gentile, options trading specialist for Money Map Press, is widely known as America's No. 1 Pattern Trader thanks to his nearly 30 years of experience spotting lucrative patterns in options trading. Tom has taught over 300,000 traders his option trading secrets in a variety of settings, including seminars and workshops. He's also a bestselling author of eight books and training courses.