When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.
Tech Alert - Microsoft Corporation (MSFT) – BUY
BUY Microsoft Corporation (MSFT) December 2021 $325-$330 in-the-money vertical BULL call spread at $3.80
Opening Trade
11-30-2021
expiration date: December 17, 2021
Portfolio weighting: 10%
Number of Contracts = 26 contracts
This is a short-term trade that software company Microsoft (MSFT) will stay above the strike price of $330 in the next 17 days.
After the omicron variant scare that caused interest rates to spike, we had a washout in tech and a cascade of buyers have flooded into MSFT when it only dropped around 2%.
Short-term news is largely priced in as we head into the December debt ceiling crisis which will be an inflationary event that is highly positive for Bitcoin and crypto-assets.
This Santa Claus tech melt-up is real as we head into a seasonally strong period for tech stocks, and I am ready to play it aggressively here with the best tech company and most resilient tech stock in the U.S.
For less aggressive traders, roll down the strike prices by $5 to give you a bigger buffer.
Microsoft's dramatic growth over the past seven years was led by the expansion of its cloud services, which include Azure, Office 365, Dynamics, LinkedIn, and its other cloud-based software. The company reports the growth of these businesses together as the "Microsoft Cloud."
Microsoft Cloud's revenue rose 36% year over year to $20.7 billion during the first quarter, which matched its 36% growth rate in the fourth quarter.
If you don’t do options, buy and hold the stock long term.
Here are the specific trades you need to execute this position:
Buy 26 December 2021 (MSFT) $325 calls at………….………$15.05
Sell short 26 December 2021 (MSFT) $330 calls at………….$11.25
Net Cost:……………………........................…….…….…..…….....$3.80
Potential Profit: $5 - $3.80 = $1.20
(26 X 100 X $1.20) = $3,120 or 31.58% in 17 days
If you are uncertain on how to execute an options spread, please watch my training video by clicking here.
The best execution can be had by placing your bid for the entire spread in the middle market and waiting for the market to come to you. The difference between the bid and the offer on these deep in-the-money spread trades can be enormous.
Don’t execute the legs individually or you will end up losing much of your profit. Spread pricing can be very volatile on expiration months farther out.
Keep in mind that these are ballpark prices at best. After the alerts go out, prices can be all over the map.
