Dear Friend,

I invite you to check out our Track Record during this difficult economic time.  In the first quarter of this year the market fell by 23%.  The actual options portfolios carried out at Terry’s Tips increased by 46% during this quarter.  Quite a difference, something that we are quite proud of.   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.

Terry 

Several analysts believe Barrick Gold is a good investment, here are two of them - Barrick Gold (GOLD) Moves to Strong Buy: Rationale Behind the Upgrade and What Makes Barrick (GOLD) an Attractive Investment Option.

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Technicals

Barrick Gold recently broke to a seven-year high after crossing above the 2016 high near $23. Similar breakouts are seen in related instruments such as the gold miners ETF (GDX). Further, GOLD is up more than 100% since the bottom in late March. The bottom correlates well with the S&P 500 yet the index has gained roughly 30% since then, in comparison. Precious metals and related stocks typically gain when equities are under pressure and the outperformance during a bullish rally in stocks speaks to the strength and demand for precious metals at this time. Lastly, GOLD was added to the IBD Top 50 list this past week along with Kirkland Gold (KL), and Franco Nevada (FNV) was added last week. The sudden addition of these three stocks adds to the bullish case for this sector.

*source Tradingview.com

If you agree there's further upside ahead for GOLD, consider this trade which is a bet that the stock will continue to advance over the next six weeks, or at least not decline very much.

Buy To Open GOLD 05JUN20 24 Puts (GOLD200605P24)

Sell To Open GOLD 05JUN20 27 Puts (GOLD200605P27) for a credit of $1.70 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when GOLD was trading near $27.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $1.30 per spread.  Each contract would then yield $168.70 and your broker would charge a $300 maintenance fee, making your investment $131.30 ($300 – $168.70).  If GOLD closes at any price above $27 on June 05, both options would expire worthless, and your return on the spread would be 128% (1198% annualized).

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Changes to Investor’s Business Daily (IBD) Top 50 This Week:

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.

Happy trading,

Terry

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Any questions?  Email Colin@terrystips.com

You can see every trade made in the actual option portfolios conducted at Terry’s Tips and learn all about the wonderful world of options by subscribing here. Why wait any longer to make this important investment in yourself?

Even better, you can become a Terry’s Tips Insider, and receive all our educational reports and materials absolutely free by opening a new account at the best options broker around - thinkorswim. If you open an account with our link, they will give you 60 days of free trading or up to $600, the same deals they give to everyone who opens an account with them. You must use this link to sign up - open thinkorswim account – and once you have funded your account with at least $3500, email Colin@TerrysTips.com and let him know that you have done it, and this is what he will do – sign you for our Premium Service package ($119.95 value plus an extra 4 months of our Premium Service, valued at another $190.80).  You get $300.65 worth of services without paying us one penny.

I look forward to having you on board, and to prospering with you.

Terry
 

    
Become a Terry’s Tips Premium Insider, and receive all our educational reports and materials
 
ABSOLUTELY FREE
 
by opening a new account at the
best options broker around

thinkorswim. 

You must use this link to sign up - open thinkorswim account – and once you have funded your account with at least $3500, email Colin@TerrysTips.com and let him know that you have done it. We will then sign you up for our Premium Service package ($119.95 value plus an extra 4 months of our Premium Service, valued at another $190.80).  You get $300.65 worth of services without paying us one penny.

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After 25+ years at this, I have seen a lot of experts come and go. I have only found two where I consistently make money by following their experience and methods; one that I have followed since the '80's in the Hogs and Bellies at the Chicago Merc, and you. Nice work!

    ~ Bob

Thank you again for being a part of the Terry's Tips newsletter. If you are interested in signing up as an Insider, visit Terry's Tips today for details.

Sincerely,
Dr. Terry Allen
Terry's Tips