Trade Alert: Our New Bonus Trade

This week has been a busy one. With earnings and trade alerts to manage our positions, there was a lot going on.

I’ll address all of it — including our open positions — in the weekly update on Monday.

I like to keep these mailbag issues strictly about the mailbag, not critical portfolio updates.

But before we get into our questions today, I like to highlight some of the great content on our website that you can use to familiarize yourself with the service.

There’s an archive of all our past weekly updates, trade alerts and mailbag issues — everything I’ve sent out. You can click here to view the archives now.

You can also find our calendars — the Original Wall Street Calendar, the Automatic Profits Calendar and the Rolling and Stacking Calendar.

When you signed up, we promised you instant access to the calendars throughout the presentation, and we placed those on our website for you to simply view, print or download. To view these three, click here.

Our online ePortfolio is available 24/7 for you to view all our open and closed positions.

I’ve also compounded several frequently asked questions into one section on the website, our FAQs. There are a lot of great topics covered, so I hope you’ll read through them and find them useful.

There is a section called Getting Started, where you can find my brief welcome video as well as our trading manual. If you’re new to the service, the trading manual is a great starting point. It lays out what you can expect from me as an Automatic Profits Alert member.

With that said, let’s jump into your questions.

From the Mailbag

Brian S. writes:

I have been reading that there may be a chance of Globalstar Inc. (NYSE: GSAT) being bought out by AT&T or possibly Verizon as another similar small company was recently purchased. Any thoughts on that?

My response:

Thanks, Brian. I have seen some of that going around. It’s based on the fact that there was a bidding war developing for Straight Path Communications over its wireless spectrum. In December, Globalstar, which provides satellite-communication services, won a victory when the Federal Communications Commission said the company had the ability to use its spectrum as a conventional wireless service. This started the rumors that AT&T or Verizon may be interested in taking over the company. None of that has come to fruition yet, but it’s still out there because Straight Path Communications is now indeed in a bidding war. AT&T and a mystery bidder are fighting for the company. So this is a legitimate possibility, and if it were to happen, it would be good for our position. Straight Path Communications is up over 300% since the bidding for the company started. Even half of that surge would be great for Globalstar. I’ll keep you updated if something develops.

Bill H. writes:

I had some confusion with the terms of your trade alerts and my TD Ameritrade account.

There was no “Good ‘Til Canceled stop-loss” or “Sell to close.”

Choices under “Type” include: “Limit,” “Market,” “Stop Market,” “Stop Limit,” “T-stop%” and “T-stop$.” It is like a multiple-choice exam.

I chose “Stop Market” guessing it was closest to the intention of the trade: selling all before it dropped lower.

Also, I lowered the stop price you’d recommended early in the day on two of the trades as I couldn’t get to the trade until after the market had closed due to the time difference (Hawaii). At close, they were both lower than your stop prices.

I am assuming they will both be gone before I get up tomorrow. Did I get these trades right? Or do you have some pointers?

Wouldn’t “T-stop$” do the same thing?

My response:

Thanks for the email, Bill. Yes, every broker will have slightly different lingo. Stop market seems like the one I’m referring to, where you place your stop at a certain price, and when it trades below that, your order will be executed at the market.

“T-stop$” refers to a trailing stop based on a dollar amount. While that will work, your stop will trail by a specified dollar amount. So instead of setting the stop at a price below the current price, you would set it at the amount the stock would pull back to hit it. You might choose $1 below the current price instead of setting it at $29.50 for HCP Inc. (NYSE: HCP), just as an example.

David C. writes:

I’ve placed the stop-losses as recommended. If a stock climbs and increases, do we cancel the order and place a new stop-loss order? Will you just send an alert to do so?

My response:

Thanks, David. Yes, when it’s time to increase our stops, I’ll send a new alert letting you know.

Stafford B. writes:

I am brand-new to your service. I joined two days ago. You recommended Tenet Healthcare Corp. (NYSE: THC) when it was selling for over $20. Would you recommend it now? Specifically, would you recommend I jump in Monday morning?

My response:

Thanks for the email, Stafford. Yes, you can jump into any position that is below my buy-up-to price. (Check out the ePortfolio to find all that information in one place.) I don’t recommend doubling down on positions, but for initiating a position, it’s perfectly fine to jump in if prices are below the buy-up-to prices.

That’s all for today. Again, I appreciate all the feedback you send in. Feel free to ask me about anything — our positions, trading, the market, whatever is on your mind. No question is too basic, and if you’re wondering about it, someone else likely is, too, but hasn’t asked yet. You can reach me at automaticprofits@banyanhill.com.

Regards,

Chad Shoop, CMT
Editor, Automatic Profits Alert