Any man who’s gone through it will tell you that a lot of work, money and stress go into buying a diamond. I mean, behind your house and your car, this little rock is one of the most expensive purchases in life. Retailers are fighting for your business, and competition among jewelers is beyond fierce — and given the potential profits involved, it has to be.

According to the Houston Chronicle, diamonds can be easily marked up 100% or more by brick-and-mortar jewelers like Tiffany and Cartier. And gone are the days of walking to your local jeweler — the guy your parents went to when you were growing up. If you’re not one of society’s elite, chances are you’re headed to a jewelry chain or looking online.

#-ad_banner-#Online diamond retailers like Blue Nile, which may mark up a diamond only 18% or so, have made deep cuts into everyone else’s profit margins. From eBay to Amazon, e-tailers are hitting the diamond game hard. The industry is being diluted further by the rise of niche, handcrafted jewelry available for sale on sites like Etsy, which only further threatens the  profits of traditional jewelry retailers.

It’s this rising trend of online, direct jewelers — along with tighter wallets in general — that could spell more pain for diamond and jewelry giant Signet (NYSE: SIG), a company already experiencing problems.

Diamonds Aren’t This Stock’s Best Friend
If you’re not familiar, Signet Jewelers is the world’s largest retailer of diamond jewelry and the largest specialty jewelry retailer in the United States, the U.K. and Canada. Under brands like Jared, Kay Jewelers, Zales and others, the company operates 3,500 stores that dominate North America and the U.K.

The company caters to the middle class (as it’s lacking the cache of higher-end brands), with many locations in and around malls or suburban shopping centers.

But as you may know, home prices have been skyrocketing… interest rates are increasing… fuel prices are rising… and consumer debt is jumping. And since most middle-class folks just want the best diamond at the cheapest price, the internet may be the place they go to shop.

As broad consumer costs build exponentially, the above factors are squeezing our wallets and purses. This leaves less room for excess, i.e., big, expensive diamonds and jewelry — the kind that used to mean fat margins for Signet.

Signet also derives $0 in revenue from Asia, the region where the jewelry market share is growing the most.

Shares have nearly reached analysts’ forward target of $38.44, and with only two of 14 analysts listing the stock as a “buy.” I think shares have gotten ahead of themselves in this last rally.

As problems persist and revenues continue to decline, Signet’s shares are likely to start moving in that same direction.

SIG cemented a new 52-week low of $33.11 on April 3. I think the stock could retest that low, falling to just above that level at $34.

Now, some investors may be satisfied with shorting the stock. That’s fine. If SIG drops 12.5% to hit that level, then it’ll be a good trade. But my Profit Amplifier subscribers and I could see a potential 35.8% gain by July if the stock falls to this level by using call options. That’s 131% annualized.

Sounds crazy right? It isn’t — Wall Street uses the same strategy every day. If this still sounds risky to you, maybe because you’re new to options trading, know that this trade breaks even if SIG hits $36.90. That’s just about 5% below recent prices, a move I think we’ll see sooner rather than later given the faltering market and the accelerating rise of online diamond sales.

How You Can Get In On This Trade
It wouldn’t be fair to my premium Profit Amplifier subscribers to reveal the specifics of this options trade in this article. But my proven strategy could be just what you need to make more on your trades than you thought possible.

While the rest of the crowd is simply buying stocks and hoping for the best, my subscribers and I have spent years “raiding” the market with our simple options trades, taking more than our fair share of gains.

I’m talking about returns of 31%, 35%, and more — all in a matter of weeks rather than months or years. In fact, we just closed a trade on TripAdvisor (Nasdaq: TRIP) for a clean 26.3% in just 10 days.

Bottom line, my stock market raiding technique is the best way to increase your returns while preserving capital and reducing risk. Of course, that’s only if it’s done correctly.

That’s why I created a special report that will walk you through the steps I take when going on market raids, which should help you avoid the costly mistakes many new traders experience. If you’d like to make trades like the one I described today — or even potentially make 80% when a stock only moves 8% — go here.