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NEW RECOMMENDATIONS FOR AUGUST

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We are recommending credit spreads on the following issues:


ASEI - AMERICAN SCIENCE & ENGR INC. develops, produces, markets, sells and provides research and engineering services with respect to, X-ray inspection systems.

KBH - KB Home is a builder of single-family homes with domestic operations in several western states, and international operations in France.

IFIN - Investors Financial Services Corp. provides asset administration services for the financial services industry through its wholly-owned subsidiaries, Investors Bank & Trust Company and Investors Capital Services, Inc.


We are recommending the following specific put credit spreads

ALL of the following spreads should require no additional margin with the right broker. If you do not have the right broker margin requirements are included in the recommendation like always

ASEI $51.72

SELL KBU-TI ASEI AUG $45.00 PUT CREDIT= $0.90
BUY KBU-TH ASEI AUG $40.00 PUT DEBIT $0.25
NET CREDIT = $0.65
 

INITIAL "NET- CREDIT TARGET= $0.65 or $65.00
POTENTIAL PROFIT (x 10 CONTRACTS @ $0.65 = $650.00
MARGIN REQUIRE. (x 10 CONTRACTS $4,350.00
RETURN ON INVESTMENT= 14.94%
EXIT STRATEGY = 1. WATCH LIST 2. MAXIMUM LOSS SPREAD PRICE DIFFERENCE $5.00
1. STOCK WILL BE PLACED ON WATCH LIST IF STOCK PRICE DROPS TO: $48.00


EQUITY INDEXES
A STOP LIMIT will be placed on the SHORT STRIKE PRICE on any EQUITY OPTION that has a STRIKE PRICE DIFFERENCE OF $5.00 or MORE.
THE STOP LIMIT ON THIS POSITION IS NOTED BELOW:
ASEI POSITION STOP IS BELOW
KBU-TI STOP LIMIT EXIT >> = $2.75
If and when the STOP LIMIT IS EXECUTED - A contingency order should be in place to then SELL the LONG SIDE of the Spread and close the position with a Market Order if and when the SHORT side needs to be STOPPED OUT

KBH $43.20

SELL KBH-TH KBH AUG $40.00 PUT CREDIT= $0.65
BUY KBH-TG KBH AUG $35.00 PUT DEBIT $0.15
NET CREDIT = $0.50
 

INITIAL "NET- CREDIT TARGET= $0.50 or $50.00
POTENTIAL PROFIT (x 10 CONTRACTS @ $0.50 = $500.00
MARGIN REQUIRE. (x 10 CONTRACTS $4,500.00
RETURN ON INVESTMENT= 11.11%
EXIT STRATEGY = 1. WATCH LIST 2. MAXIMUM LOSS SPREAD PRICE DIFFERENCE $5.00
1. STOCK WILL BE PLACED ON WATCH LIST IF STOCK PRICE DROPS TO: $41.50

EQUITY INDEXES
A STOP LIMIT will be placed on the SHORT STRIKE PRICE on any EQUITY OPTION that has a STRIKE PRICE DIFFERENCE OF $5.00 or MORE.
THE STOP LIMIT ON THIS POSITION IS NOTED BELOW:
KBH POSITION STOP IS NOTE BELOW
KBH-TH STOP LIMIT EXIT >> = $2.50
If and when the STOP LIMIT IS EXECUTED - A contingency order should be in place to then SELL the LONG SIDE of the Spread and close the position with a Market Order if and when the SHORT side needs to be STOPPED OUT


IFIN $44.74

SELL FLQ-TV IFIN AUG $42.50 PUT CREDIT= $0.45
BUY FLQ-TH IFIN AUG $40.00 PUT DEBIT $0.15
NET CREDIT = $0.30
 

INITIAL "NET- CREDIT TARGET= $0.30 or $30.00
POTENTIAL PROFIT (x 10 CONTRACTS @ $0.30 = $300.00
MARGIN REQUIRE. (x 10 CONTRACTS $2,200.00
RETURN ON INVESTMENT= 13.64%
EXIT STRATEGY = 1. WATCH LIST 2. MAXIMUM LOSS SPREAD PRICE DIFFERENCE $2.50
1. STOCK WILL BE PLACED ON WATCH LIST IF STOCK PRICE DROPS TO: $43.50
2. ON SPREADS WITH 2.50 or less difference in STRIKE PRICES the Difference
IN THE STRIKE PRICE WILL BE OUR MAXIMUM EXPOSURE - WE WILL NOT USE STOPS ON THOSE POSITIONS. THEY WILL GO ON THE WATCH LIST AND BE FOLLOWED WITH INSTRUCTIONS AS TO HOW TO PROCEED OR/WHAT EXIT POINT NEEDS TO BE ESTABLISHED




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