by Ian Harvey
June 06, 2018
OUT WHILST THE GOING IS GOOD!
GREED CAN BE THE UNDOING OF A GOOD PROFIT!
Twitter Inc. (NYSE:TWTR)
Here is an update of Twitter’s call options trade. This options trade was recommended to “Mentorship Members” of Stock Options Made Easy on Wednesday, May 30, 2018; with potential profits of 256% in less than a week - and more growth expected!
PATIENCE PAYS OFF!
YOU NEED TO BE IN TO PROFIT!
Twitter Inc. (NYSE:TWTR), a global platform for public self-expression and conversation in real time, has finally hit the buy zone, as it continues to make gains following its upbeat first-quarter earnings report last month.
As well as being the favorite communications tool of President Donald Trump helping it regain investor favor after three straight quarters of accelerating earnings growth. Twitter also has posted two quarters in a row of accelerating sales growth.
Twitter shares broke out of a cup-with-handle base at a buy point of 33.88 on May 21, but retreated over the next few days. During a rough session on the broader market Tuesday, the stock surged into the buy zone once more. It climbed 1.2% to close at 34.04. Earlier in the session, it rose as high as 34.83.
Twitter has been on a run since busting out of a 62-week cup-with-handle base at a buy point of 22.58 on Dec. 14. It briefly slipped below that buy point in late January before continuing its ascent.
Twitter is a strong growth company where earnings and revenue are expected to grow at a rate that outpaces the market. Strong earnings and impressive sales imply that the technology sector's hot streak could continue throughout 2018-despite recent market-wide volatility.
Twitter shares have added about 12.3% in about
a month when it last reported earnings.
Option trade to consider: Buy the TWITTER JULY 20 2018 35.000 CALL at approximately $1.60.
Shares of Twitter gained 5% yesterday as indexing managers S&P Dow Jones Indices announced that the social media giant would become part of the S&P 500 index. Twitter will take the place of Monsanto, which the index manager expects will finally get acquired by Germany's Bayer.
Twitter's move into the S&P 500 is extending the 52-week highs that TWTR stock set on Monday.
Being adding to the S&P 500 is generally viewed as a good thing. Aside from hitting a point where a company is deemed good enough for the group, there is a fresh new wave of buyers. It's not just momentum traders loading up on the name because of the news, either.
Exchange-traded fund, mutual fund and portfolio managers now have to buy the stock because of its position in the index. If they have exposure to the S&P 500 or a client that wants exposure to the index, they have to buy it. And by buying that fund, they buy the stocks that are in the fund.
Twitter has a lot of things going for it, the most recent of which involves a new video strategy. Those types of product adjustments and incremental improvements to the platform will make Twitter more attractive to users. It continues to serve as a breaking news outlet and a platform for well-known figures to get the word out directly to their followers.
Twitter's jump will likely have a considerable impact on Global X Social Media ETF (SOCL). Twitter takes about 12.28% of SOCL, holding the top position. As a result, the company's performance is crucial to the entire social media sector.
The product charges 65
bps in annual fees. SOCL has company-specific concentration risk, putting more
than 60% investments in its top 10 holdings.
Another ETF that will be impacted by Twitter's earnings is AdvisorShares New Tech And Media ETF (FNG). Twitter takes about 5% of the fund while Netflix holds about 6%. Yet another ETF, BUZZ US Sentiment Leaders ETF (BUZ), puts 3.38% weight in Twitter, which is the fund's top holding.
So, for members of the “Mentorship Program” who managed to execute this trade recommended by Stock Options Made Easy; a nice tidy profit already of more than 256% made in less than a week. Is it now time to exit the trade?
Entering the option trade at a cost of $1.60 or less; reaching as high as $5.70 (before closing at $5.19); one options contract would provide a profit of $410.00.
Now is the time to decide if it is worth continuing to hold these trades or exit on excellent profits. It is nearly always prudent to exit a trade before an unknown incident occurs that could rattle a sound profit, and this is a fine example of such a situation.
As you would have by now realized, some of our trades are based on earnings predictions. This is not to say all trades recommended to members follow this pattern, as seen in this scenario as part of the “Mentorship Program”, but during earnings season this strategy has been very profitable.
Sometimes it is our approach to predict whether a company will beat or miss estimates, whether the stock will appreciate or depreciate as a result and what strategies investors and traders can use – such as found with the “Earnings Predictions Program”. This type of prediction is based on thorough investigation and fundamentally based research, and the results have been very exceptional.
Our proven track record says it all!!
If you not a member ……… SIGN IN HERE
What To Do Now…….
If you interested in being part of other profitable actions just click here……