Categories: Bull Market Alert HotlinesStock Market News

Taking 27% and 71% Profits in Your Two Small-Cap China Plays

If you know how options are valued, you know that their value explodes after such big “up” days. Indeed, your options were up 90% (!) in just yesterday’s trading.

Although the options are up “only” a modest 26.67% overall, I am recommending that you sell all of your March $20 call options here to lock in your gains.

Here’s why. You’ve held these options quite a while now, and their value is set to decline rapidly as they approach the March expiration deadline. I expect to recommend some cheaper and longer-lasting options in CCME when the stock settles — or even pulls back a little.

But hold onto CCME stock for now. As you know, this is my no. 1 pick for 2011 — and one that I hold both personally and for my clients at Global Guru Capital — and I believe you’ll be making some more big profits on this one.

Spreadtrum Communications Inc. (SPRD) also jumped 4.1% yesterday. This sent the May $17.50 calls soaring. With the stock up 21.03% and the options up 71.43%, I am recommending that you sell half of your options here to lock in your gains. But hold onto both the stock and the options for potentially bigger future gains.

If you are a new subscriber to Global Bull Market Alert — and I know that there are close to 50 of you after Tuesday’s special teleconference — I want to remind you to make sure to watch this introductory video on my option trading philosophy to help you maximize your gains.

Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world. He was the Editor of The Global Guru, a free weekly e-newsletter, and also edited the trading services Momentum Trader Alert, which focused on making short-term profits in the hottest markets in the world, and The Alpha Algorithm, which was designed specifically to deliver big, fast triple-digit winners, month after month. He was also the editor of Smart Money Masters, a monthly service focused on longer term investments recommended by the brightest minds in the business. Mr. Vardy has been a regular commentator on CNN International and the Fox Business Network. He has also published articles in The New Republic, The World and I, and The Baker & McKenzie Legal Review. The Global Guru/Nicholas Vardy has been cited in The Wall Street Journal, Newsweek, Fox Business News, CBS MarketWatch, Yahoo! Finance, and MSN Money Central. Mr. Vardy graduated from Stanford with a B.A. — with honors and distinction — in both Economics and History, and he also earned an M.A in Modern European Intellectual History. After winning a Fulbright Scholarship, he earned a J.D. degree at Harvard Law School where he was an editor of the Harvard International Law Journal. When not uncovering investment opportunities for his subscribers and investors, Mr. Vardy is a keep-fit enthusiast and an avid student of classical music.