MaxROI - WSD Insider

BY KARIM RAHEMTULLA, EXECUTIVE EDITOR, MAXROI
MaxROI
COLLECT YOUR FIRST
“OPM” FORTUNE TODAY
Dear MaxROI subscriber,
There’s nothing like using other people’s money to build a fortune of your own.
I mean, why use your own money when it’s perfectly legal to uses someone else’s. Especially
in this market!
It’s a phenomenon seldom (if ever) reported by the press, yet in one recent week alone...
Apple (AAPL) helped a few investors safely pocket a $493-million fortune…
Google (GOOG) helped a few investors safely pocket a $176-million fortune…
Best Buy (BBY) helped a few investors safely pocket a $6.6-million fortune…
All using nothing but other people’s money!
It’s why I like to call put-selling an “OPM” strategy. You’ll use other people’s money to boost
your gains - time and time again. (If you haven’t read about put-selling yet, be sure to check
out my Strategy Primer by clicking here.)
Now, I regularly release a series of OPM trades in what I call Intelligrid Alerts. And these
include picks that are a combination of both put-sells and LEAPS options that I believe will
perform well for us in the months ahead. (LEAPS are also covered in my Strategy Primer.)
Reminder: With our put-sells, I’m picking fundamentally sound companies – ones that we’d
ultimately like to own if the prices on the shares fell further. In other words, we want to buy
companies we like at a discount – at our price.
Of course, not all of these picks will be appealing to you. And you shouldn’t risk more than
you’re ultimately willing to spend, in the event that we do end up buying them (as we have
occasionally done in the past).
Most of the time, however, we don’t hold these positions until expiration. Which means we
The MaxROI Intelligrid Alert
1
usually get out early (i.e., take the cash and run).
So, without further ado, here are my latest picks…
OPTIONS PRICES HAVE CHANGED.
Please note, the following put-sell trades
are no longer active.
Let the OPM Party Begin in 3… 2… 1…
The first recommendation is a put-sell on Petrobras (PBR). More specifically, we’re selling
the July 2014 $12 puts. Remember, we’re selling these puts to OPEN. This means we’re
obligating ourselves to buy this oil giant if we “get put.”
Just so you know, this pick is currently in the money, meaning that shares are currently
trading below the strike price. You’ll still be able to collect the money up front. This simply
increases our chances of “getting put,” which will give us the opportunity to own the shares
below where they’re currently trading. Heck, even at current prices, Petrobras is a great
value.
Remember, our goal is to either make the returns from selling the put – or to own the shares
at incredibly cheap prices.
SELL to open the Petrobras July 2014 $12 PUT option (PBR JUL14 $12P). Go to the last page to
see how much cash you’ll pocket.
THIS PUT-SELL IS NO LONGER ACTIVE
The second play is the backbone of the internet, Cisco Systems (CSCO). The company has
sold off recently after providing weaker guidance. Despite that guidance, however, Cisco is
still an outstanding company that’s constantly churning out cash and buying back its own
shares. Not to mention, it’s hugely profitable and pays a healthy dividend. If we get put on
this play, we’ll be in good shape to sell calls against the stock, while also collecting a healthy
dividend.
The MaxROI Intelligrid Alert
2
THIS PUT-SELL IS NO LONGER ACTIVE
SELL to open the Cisco January 2015 $20 PUT option (CSCO JAN15 $20P). Go to the last page to
see how much cash you’ll pocket.
The third pick is a company currently benefiting from booming aluminum usage in manufacturing. From Ford’s (F) latest F-150, to Boeing’s (BA) new lighter-weight aircraft –
aluminum is becoming the building material of choice in the transportation industry. In order
to take advantage of the increased use of this lightweight metal, we’re going to try to buy
shares of Alcoa (AA) at about a 13% discount to their current levels.
SELL to open the Alcoa January 2015 $10 PUT option (AA JAN15 $10P). Go to the last page to
see how much cash you’ll pocket.
THIS PUT-SELL IS NO LONGER ACTIVE
Next up is Capital Senior Living (CSU), a fundamentally sound company that owns,
operates and manages senior living communities. Such facilities are in strong demand, as the
demographic of the United States changes and more people are aging and looking for “nice”
communities to retire to.
THIS PUT-SELL IS NO LONGER ACTIVE
SELL to open the Capital Senior Living June 2014 $22.50 PUT option (CSU JUN14 $22.50P). Go to
the last page to see how much cash you’ll pocket.
*Remember: Be patient and don’t always sell at the bid. Try to sell between the
bid and the offer if the spread is wide.
Immediately Shrink Your Cost Basis With
LEAPS
The next play is a LEAPS option on Potash Corporation (POT), which is one of the world’s
largest fertilizer and seed companies. The sector sold off in recent years after the recession in
the United States and Europe, and the slowdown in China hurt demand.
However, things are picking up in both local and emerging markets. Potash should benefit
from this – along with the need to produce more food for a growing global population. We
will have two years to find out if this trend develops.
BUY to open the Potash January 2016 $40 CALL option (POT JAN16 $40C). Do NOT pay more
than $2.15.
The MaxROI Intelligrid Alert
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For Masters Only!
Our final pick is a Master’s Pick.
Essentially, it involves a major capital outlay in the form of a higher margin requirement. But
it has the potential to put some BIG bucks in your pocket. Or it will allow you to ultimately
own a premier company at less than eight times earnings – with a growth rate of twice that
and more cash in the bank than most countries!
I’m talking about Apple (AAPL), which we’ve been tracking for a while… and making money
from.
Here’s the play:
SELL to open the Apple January 2015 $465 PUT option (AAPL JAN15 $465P), which was recently
trading around $25.50 per contract. At that price, you will receive a whopping $25,500. Go to the
last page to see how much cash you’ll pocket today.
THIS PUT-SELL IS NO LONGER ACTIVE
Please note: This is a play for EXPERIENCED investors only!
Let us know how you do with these trades by going here.
Karim Rahemtulla
The MaxROI Intelligrid Alert
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04-03-2014