Trade Alert - (VST) January 28, 2024 - BUY

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 - (VST) - BUY

 

Buy the Vistra Energy (VST) February 2025 $100-$110 in-the-money vertical bull call debit spread at $9.00 or best

 

Opening Trade

1-28-2025

expiration date: February 21, 2025

Portfolio weighting: 10% weighting

Number of Contracts = 12 contracts

By dropping a cataclysmic 40% from the recent $200 high, Vistra shares are essentially better that there is no longer a need for additional electricity in the US. The speculation was prompted by the news of DeepSeek’s progress in AI programming, which would effectively drop the need for chips by 99%....if true.

I’m not buying it.

The selloff gives us another great entry play on the deregulation of new nuclear. Some 80 plants of the new design could be ordered in the next decade.

Vistra Corp. is one of the preeminent nuclear power plants in the United States, and one of the most rapidly expanding, with four operating plants.

We also have the enormous advantage with this trade in that the options are sporting a sky-high 75% implied volatility. This trade also gets very solid support at the 200-day moving average at $110.

Therefore, I am buying the Vistra Energy (VST) February 2025 $100-$110 in-the-money vertical bull call debit spread at $9.00 or best.

DO NOT USE MARKET ORDERS UNDER ANY CIRCUMSTANCES.

Simply enter your limit order, wait five minutes, and if you don’t get done, cancel your order and increase your bid by 10 cents with a second order.

Do not pay more than $9.40 or you will be chasing.

If you live in a foreign time zone when the US stock market is closed, such as Australia, or don’t want to sit in front of a screen all day, simply enter a spread of Good-Until-Cancelled orders overnight, like  $9.00, $9.10, up to $9.60. You should get done on some or all of these.

Vistra recently received permission from the Nuclear Regulatory Commission Comanche Peak, a two-unit facility, is the third of Vistra's four nuclear plants to receive its license extension from the NRC. Comanche Peak units 1 and 2 can now operate through 2050 and 2053, respectively.

The company's Beaver Valley Nuclear Power Plant units 1 and 2 in Pennsylvania are licensed through 2036 and 2047, and Davis-Besse in Ohio is licensed through 2037. Perry Nuclear Power Plant in Ohio filed its application for renewal in 2023 and is currently in the NRC review process.

With this trade, I am willing to bet that Vistra Corp. shares will not fall below $110 by the February 21 option expiration in 18 trading days.

To learn more about Vistra Energy, please their website at https://vistracorp.com

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

Buy 12 February 2025 (VST) $100 calls at………....…$44.00

Sell short 12 February 2025 (VST) $110 calls at…….$35.00

Net cost:………………………….……….……………..............$9.00

Potential Profit: $10.00 - $9.00 = $1.00

(12 X 100 X $1.00) = $1,200 or 11.11%

 

 

 

 

 

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.