Trade Alert - (ZM) February 7, 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 – Zoom Video Communications, Inc. (ZM) - BUY

Buy Zoom Video Communications, Inc. (ZM) February 2023 $83-$88 in-the-money vertical BEAR PUT spread at $4.35

Opening Trade

2-7-2023

expiration date: February 17, 2023

Portfolio weighting: 10%

Number of Contracts = 23 contracts

With just 10 days left, I will put on some protection with Zoom Technologies (ZM).

The price action today hasn’t been encouraging and we have 2 call positions in LYFT and CRM.

The volatility in tech has been unprecedented this year so far – within minutes a tech stock could be up or down a few percent.

Remember to use limit order and this trade works until $4.50.

Cathie Woods saying that ARKK is the new Nasdaq has me feeling this could be a short-term top in ZM. ZM is one of ARKK’s largest positions. She hasn’t been right about anything after her call on Tesla and her call for $1 million per Bitcoin feels more like a marketing stunt than anything.

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

Buy 23 February 2023 (ZM) $88 puts at………….………$11.15

Sell short 23 February 2023 (ZM) $83 puts at………….$6.80

Net Cost:……………………..…….………..…................….....$4.35

Potential Profit: $5- $4.35 = $.65

(23 X 100 X $.65) = $1,495 or 14.94% in 10 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.

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