Shah Gilani's Archive

One of my favorite things about trading is taking a reasonable amount of risk on a speculative-type trade and having it pay off… big time.

The key to unlocking big gains is lining up an upcoming catalyst with an options trade that has the right reward-to-risk profile. Some pros call these kinds of trades asymmetric risk trades, but I like to call them “multiplier trades” because they’re trades where the upside is 2x, 3x, 4x, or more than the downside.

Here’s an example…

Today marks the first edition of my Watchlist. From now on, every week, I’m going to tee-up what I’m watching in the days ahead, why it’s important, and how to trade what’s hot and what’s not.

This week is going to be crazy, I can guarantee you that.

This week, we brought you special research on the “New Age IPOs” known as Special Purpose Acquisition Companies (SPACs).

I showed you how to zero in on the SPACs capable of delivering stratospheric profits.

I shared the secrets you’d need to dodge the profit-draining losers.

And I made you a promise.

A promise to round out our three-installment foray into the world of SPACs with a recommendation that would start you down a profit pathway of your own.

With today’s edition of Total Wealth, consider that promise kept. I’m delivering you a SPAC created by one of the top dealmakers of the last three decades

In the first of my three-part series on SPACs, I outlined exactly what Special Purpose Acquisition Companies (SPACs) are, how they work, and the 400%, 500%, or more in gains they can yield investors.

Unless you’ve been hiding from the market, and heaven help you if you have been, you know SPACs are the hottest sector out there right now, and with good reason. There are new SPAC IPOs being minted literally daily, sometimes two or three a day. Traders are playing them, and investors are plowing into them. And there are going to be spectacular winners. And there are going to be lots of losers.

What you need to know, because there are so many SPACs coming out, is which ones are going to be the winners and which ones are going flounder or fail. Because, needless to say, not all SPACs are created equal, and any advice you’ve heard about skimming the cream of the SPAC crop is probably very wrong.

While the likes of QuantumScape Corp. (NYSE:QS) can hit a whopping 1,200% peak during their run, other enticing-looking SPACs can be snakes in the grass. The difference between knockout winners and bottom-of-the-barrel slugs isn’t always obvious.

That’s because there are lots of nuances, lots of details that matter when it comes to SPAC sponsors and founders, the teams they convene to look for acquisition targets, the price they pay for operating companies, how those acquisition targets are valued before a deal is reached, who invests in target companies under what deal and valuation terms before they are acquired, who are the investors providing PIPE (private equity in public companies) financing for the acquisition/merger deal and what are their incentives and deal terms, how much operating capital will be injected into the new company, what are its real prospects?

Those aren’t hard questions to answer. In fact, the answers are simple, you just have to know where to look for all those details, because they’re out there. They’re in deal documents, in disclosures, in regulatory filings, in proxy materials.

They’re everywhere I look. And I look everywhere.

But you may not be looking everywhere, so to consistently cash in on the winners while dodging the losers that could drain away your profits, you need a powerful but simple strategy to follow.

And I have one

You can’t go anywhere these days without hearing about “SPACs,” and there’s a good reason for that.

Wall Street refers to these by their technical name, “Special Purpose Acquisition Companies,” but I see them for what they are: “New Age IPOs” that can give retail investors a way to cash in on newly minted companies.

Wall Street and retail investors alike had a stellar run with SPACs last year, and now SPACs are outdoing themselves this quarter, becoming one of the hottest trading opportunities on the market right now, yet so few people know about SPACs.

This is a major trading opportunity I don’t want you to miss. So, here’s what’s in store for you this week:

I’ve got three special reports on SPACs – what they are, how to play them, and a recommendation to round off the whole series – heading to your inbox over the next few days.

You’re going to get the all-inclusive, grand tour of SPACs. Ins and outs, nooks and crannies… my team has researched it all so you don’t have to.

Today, you’re going to get to know SPACs, get friendly with them, so you know what you’re trading and why before we launch into how to buy and how to profit.

So, do you want to cash in?

Investor Peter Lynch achieved “legend” status during the 1980s – and it wasn’t just because of his best-selling book One Up on Wall Street.

It was the fact that he made a lot of mutual fund investors rich.

While helming the Fidelity Magellan fund from 1977 to 1990, Lynch delivered an average annual total return of more than 29% – a performance that would have turned a mere $10,000 investment into $280,000 at the time he decided to leave.

But I’m going to let you in on a stunning secret: Most of the huge gains Lynch made for investors was due to a strategy that almost nobody ever talked about.

And Lynch wasn’t alone.

Legendary hedge fund manager and value player Seth Klarman has used this strategy throughout his career. Edward Thorp, one of the best arbitrage and quantitative investors of all time, continues to use it.

And this is why, in Tuesday’s article, I told you to hang on to your bank stocks. There’s still money to be made on banks – and it’s with the same strategy that made these men filthy rich.

The strategy itself is as simple as it is powerful, yet virtually no retail investor uses it.

Heck, most investors don’t even know about it.

Today I’m going to tell you all about the strategy, and we’ll put it to use ourselves – with a brand-new stock recommendation…

Bank stocks have had a really good run higher lately, but last week and early this week, they’ve been hit hard as investors seem to be fleeing the country’s biggest and most profitable bank names.

Those investors are making a huge mistake – and I hope you’re not one of them.

In fact, now’s the best time to buy bank stocks.

Today, let’s talk about why investors are running scared, why bank stocks are a “buy” right now, and how high they could go…

Yesterday’s official U.S. Federal Reserve “statement” on the economy, unemployment, inflation, and interest rates was simple, straightforward and unsurprising – in short, just what the markets needed.

The few upgraded projections in the central bank’s commentary – which might have scared investors – were tempered with coddling commentary about staying-the-low-interest-rate course until the Fed’s dual mandates are met.

And if that wasn’t clear and comforting enough, Fed Chairman Jerome Powell in his follow-up press conference, handled some tough questions with temperate answers, assuaging our fears with a tacit promise that no surprises would jump out anytime soon.

The markets could be rocked tomorrow by something called a Quadruple Witching Day, a day in which single-stock options, single-stock futures, and stock-index options and stock-index futures… the works are coming up for expiration. And depending on how the market closes today, we could see some major waves going into next week.

I cover the whole debacle in the below video and I encourage you to watch it ASAP. You’re going to want to prepare yourself.…

As broad as the markets are, as vast as the economy is, as much data as there is to key in on out there, there’s one thing I’m watching now that matters more than everything else.

It’s what the Federal Reserve’s going to do, or not do, to interest rates.

Because based on what Fed members on the Federal Open Market Committee (FOMC) decided in their two-day meeting, which gets released as their official “statement” today at 2:00 pm, will either calm markets or could knock them off their recent all-time highs, down maybe 10%-15%, or more.

Here’s what you need to do to prepare yourself, because one way or the other, something’s gonna give…