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 - Dell Technologies Inc. (DELL) – BUY
Buy Dell Technologies Inc. (DELL) December 2024 $110-$115 in-the-money vertical BULL CALL spread at $4.32
Opening Trade
11-27-2024
expiration date: December 20, 2024
Portfolio weighting: 10%
Number of Contracts = 23 contracts
Dell is a stock that has had a great run in the past 365 days and recently announced a weak earnings that cratered the stock.
Dell forecasted fourth-quarter revenue and earnings below consensus despite bullish commentary from the company on AI sales growth. The PC maker reported quarterly earnings that beat expectations for earnings per share but came up light on overall revenue.
This is a trade that there will be a bounce in the underlying stock of DELL.
The stock is now a new AI play as it has forayed into the AI server business. They deserve a higher multiple and this explains why the stock has outperformed so greatly in the past year.
Don’t miss this opportunity to trade Dell for a nice discount in the short term.
Don’t pay more than $4.40.
Here are the specific trades you need to execute this position:
Buy to Open 23 December 2024 (DELL) $110 calls at…….……$15.65
Sell to short 23 December 2024 (DELL) $115 calls at……….….$11.33
Net Cost:……………………..........................…….………..…….........$4.32
Potential Profit: $5 - $4.32 = $0.68
(23 X 100 X $.68) = $1,564 or 15.74% in 23 days
If you are uncertain about 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.