Trade Alert - (AMD) November 13, 2023

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 - Advanced Micro Devices, Inc. (AMD) – BUY

Buy Advanced Micro Devices, Inc. (AMD) December 2023 $100-$105 in-the-money vertical BULL CALL spread at $4.15

Opening Trade

11-13-2022

expiration date: December 15, 2023

Portfolio weighting: 10%

Number of Contracts = 24 contracts

This is a short-term mildly bullish trade on chip manufacturer AMD that AMD will stay above $105 in the next 32 days.

The stock has done a double this year and has been catapulted ahead because of this year’s AI craze.

I do believe that Nvidia (NVDA) reporting on November 21 will be a catalyst for AMD shares to move higher.

November is also a seasonably positive time of the year for tech stocks and the move up has been quite dramatic – 9% in the past 2 weeks or so.

Much of the bad news is priced in and this could foreshadow a blistering 2024 for tech stocks. Bad news discounted is highly bullish for high quality chips stocks.

Don’t pay more than $4.25.

Here are the specific trades you need to execute this position:

Buy 24 December 2023 (AMD) $100 calls at………….………$18.15

Sell short 24 December 2023 (AMD) $105 calls at………….$14.00

Net Cost:……………………..........................…….………..…….....$4.15

Potential Profit: $5 - $4.15 = $.85

(24 X 100 X $.85) = $2,040 or 20.48% in 32 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.

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