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 - Meta Platforms, Inc. (META) – BUY
Buy Meta Platforms, Inc. (META) July 2023 $270-$275 in-the-money vertical BULL CALL spread at $3.85
Opening Trade
7-3-2023
expiration date: July 21, 2023
Portfolio weighting: 10%
Number of Contracts = 25 contracts
Hard to believe I haven’t executed many trades in Meta (META) this year.
It’s on fire.
The stock has gone from the ugly red-headed stepchild of 2022 to a stock that doesn’t go down in 2023.
The stock has more than doubled and I see no reason for the stock to crater in the short term with a plethora of tailwinds at its back.
The US economy has turned out to be far more resilient than anyone could have expected.
Consumers keep spending like there is no tomorrow and that is all good for companies like META which is a microcosm of the larger economy in itself.
The trade is a little aggressive and traders who aren’t that comfortable can move back their strike prices to $265-$270.
My call of bullish tech has been spot on and the Fed delivering us these itty-bitty .25% rate hikes has been pretty much quantified by 99% of traders out there. Traders like certainty and Powell gives us that.
Unless there is a black swan, I don’t expect tech stocks like META to tank in the short term.
Don’t pay more than $4.10.
Here are the specific trades you need to execute this position:
Buy to Open 25 July 2023 (META) $270 calls at………….………$18.30
Sell to short 25 July 2023 (META) 275 call at…….............…….$14.45
Net Cost:……………………..…….............................………..…….....$3.85
Potential Profit: $5 - $3.85 = $1.15
(25 X 100 X $1.15) = $2,875 or 29.87% in 19 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.
