Hello, Profit Takeover team!
As promised, today I’m giving you my next favorite Profit Takeover trade idea…
It’s one that I feel meets my criteria, which includes:
- Volatility in my favor
- The potential for asymmetric returns — or those with a favorable risk/reward backdrop
- And one that’s attracted both institutional and retail-level attention recently, essentially giving me “two-factor authentication“
Let’s get to it.
Pfizer (NYSE: PFE) has been just about one of the most popular stocks of the year… for obvious reasons.
Well, the pharmaceutical company reported quarterly earnings yesterday, and following known events like this, it’s not uncommon for option prices to implode — it’s called a “volatility crush.”
So by waiting to buy PFE options until after earnings, I not only eliminate being directionally wrong on the knee-jerk reaction to the report, I can also get contracts basically on sale!
And speaking of earnings, I liked what I saw in the pharma giant’s quarterly report, so there’s fundamental strength there too.
In fact, I haven’t seen much appreciation since the coronavirus vaccine distribution began. And that means some upside room is left for PFE shares…
PFE daily chart – courtesy of StockCharts
That’s why, today, I’m going to give you exact instructions on the best option trade to take advantage of PFE’s upside potential.
Profit Takeover Trade for May 5, 2021
I’m looking to buy to open the Pfizer (NYSE:PFE) September 17, 2021 $41-strike calls for roughly $1.65, give or take.
Remember, though, stock and option prices are FLUID and constantly moving, so the option price I see one minute won’t likely be the price you see the next.
I’m trading based on my personal risk appetite, and you should trade based on yours.
So, that’s what I’m looking at this week, gang!
That’s it for today, Profit Takeover crew, but I’ll be dropping in tomorrow to talk about a major cult stock that will be on my radar next week… Stay tuned!
Talk to you soon,
May 05 2021