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.
Trade Alert - (NVDA) – BUY
BUY the NVIDIA (NVDA) October 2022 $95-$100 in-the-money vertical Bull Call spread at $4.00 or best
Opening Trade
9-29-2022
expiration date: October 21, 2022
Number of Contracts = 25 contracts
Keep in mind that NVIDIA is one of the most volatile stocks in the market. It should be at the core of any long-term portfolio. I expect the stock to triple over the next three years.
Analysts always make projections based on extrapolating current demand. What they don’t take into account is the fact that NVIDIA’s products are being designed into new products at an incredible rate.
It’s also hard to imagine NVIDIA’s stock not going ballistic when Tesla’s EV production is rocketing from 1 million to 20 million a year, which it will do by 2030.
That’s me. I’m always looking at the 2030 view. I have been doing so since 1970.
Santa Clara-based NVIDIA designs and manufactures high-end, top-performing graphics cards or GPUs. There is probably one on your PC. They are essential in the artificial intelligence, automobile, PC, supercomputing, cybersecurity, and gaming industries.
They are also crucial for national defense. The Biden administration recently banned NVIDIA from exporting high-end chips and their manufacturing equipment to China, which they were using to build sophisticated weapons to use against us. This revenue loss is what has taken the shares down to their current low levels, down 65% in six months.
NVIDIA has long been one of the fastest growing US companies, Since 2005, its annual net income has soared from $89 million to $9.7 billion. Its NVIDIA Titan V graphics processing unit used for supercomputing architecture sells for an eye-popping $2,999. It is the one stock every portfolio wants to buy on the dip.
And before you ask, NVIDIA is an abbreviation for the Latin word for “envy.”
To learn more about the company please visit their website at https://www.nvidia.com/en-us/
I am therefore buying the NVIDIA (NVDA) October 2022 $95-$100 in-the-money vertical Bull Call spread at $4.00 or best.
Don’t pay more than $4.30 or you’ll be chasing on a risk/reward basis.
Only use a limit order. DO NOT USE MARKET ORDERS UNDER ANY CIRCUMSTANCES. Just enter a limit order and work it.
This is a bet that NVIDIA will not fall below $100 by the October 21 options expiration in 16 days.
Here are the specific trades you need to execute this position:
Buy 25 October 2022 (NVDA) $95 calls at…………...………$27.00
Sell short 25 October 2022 (NVDA) $100 calls at…………$23.00
Net Cost:………………………….………..……….............….….....$4.00
Potential Profit: $5.00 - $4.00 = $1.00
(25 X 100 X $1.00) = $2,500 or 20.00% in 16 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.
