Hi Traders and Investors!
We saw a lot of green this week with most of the major indices!
Dow Jones Industrial Average: 26,428.32 +114.67 (+.44%)
S&P 500: 3,271.12 +24.90 (+.77%)
Nasdaq: 10,745.27 +157.46 (+1.49%)
Russell 2000: 1,480.43 -14.67 (-.98%)
Investing Ideas
It also looks like a lot of the companies we are investing and trading in did well on their report cards these past two weeks! Make sure you watch our Q&A Video for this week since we talk about these companies in more detail. However, here's a summary of what we think about the companies right now:
Microsoft MSFT - Good covered call candidate
PayPal PYPL - Good investment
Advanced Micro Devices AMD - Good covered call candidate
Apple AAPL - Good investment and eventually good covered call candidate due to it's 4 for 1 stock split later this month
Visa V - Good for a long-term investment, but the price might consolidate the next couple of weeks due to it's mediocre report
MasterCard MA - Good for a long-term investment, but the price might consolidate the next couple of weeks due to it's mediocre report
Again, these are just our recommendations, so please trade and invest in what you feel comfortable with. If you're going to start a position in any of these companies, start with purchasing 1-5 shares first and let the share prices rise around 5-10% before investing anymore. We want to slowly add on to our positions and not put all of our money in at once.
Earnings
Keep an eye out on these earnings dates for this month:
Square SQ - Wed, August 5
Home Depot HD - Tue, August 18
Costco COST - Thu, August 27
Trade of the Week
If you want to sell some covered calls this week, you can consider selling them on MSFT. Right now, MSFT is $205.01 and you can sell a covered call for the August 28, 2020 expiration and $205 strike for a $615 premium. On top of that, the ex-dividend date is on August 19, 2020. You can make an additional $51, but you need to make sure you own your 100 shares before the ex-dividend date.
We also uploaded a video this week on the details of this trade, along with selling covered calls on AMD and V.
As we mentioned before, if you are starting to sell covered calls, we encourage you to sell an ITM strike first, so you can lower your cost basis.
We've been cooking up something exciting🧑🍳! We have an extension course launching this Monday! In this five video series, we’re going to introduce another strategy for you to use in conjunction with selling covered calls. What’s this other strategy? It’s called selling cash-secured puts. By combining the strategies of selling covered calls and cash-secured puts, it creates a cash-generating trading system called The Wheel Strategy 🎡.
Stay healthy and safe, and see you all next week!
- Call to Leap Team
The following article is strictly the opinion of the author and is to not be considered financial/investment advice. Call to Leap LLC and the author of this article does not claim to be a registered financial advisor (RIA) or financial advisor. Please visit our terms of service and privacy policy before reading this article.