AMD is rising too fast, Intel's earnings report may become a callback catalyst

Recent$Advanced Micro Corporation (AMD) $The stock price continues to rise, mainly due to the tight supply of data center CPUs, strong demand from cloud vendors, and rising market expectations for the growth of AI business. At the same time, the upgrade of major banks and capital inflows also strengthened market sentiment.

However, it should be noted that AMD's rise relies heavily on the assumption of "tight supply and demand". Once supply improves or demand falls short of expectations, the stock price may pull back.

Intel's latest financial report shows that Q1 guidance is weak, inventory buffers are exhausted, and production capacity tilts take time to release, causing its stock price to fall by more than 10% after hours. This information may give the market a new judgment on the tightness of overall CPU supply and demand, thus affecting AMD's valuation and stock price performance.

Therefore, in the context of AMD already showing a clear rise, investors can considerShort high or hedge with options, to deal with potential callback risks.

AMD (AMD) Bear Call Spread Options Strategy

1. Strategy structure

Investors in$Advanced Micro Corporation (AMD) $Build aBear Call Spread Bear Call Spread。 The strategy passesSell lower strike price Call while buying higher strike price CallCompose of, belonging toLimited benefits, limited risksThe bearish or volatile bearish strategy is suitable for investors to judge AMD's stock priceWon't rise significantlySituation.

(1) Sell Call with lower execution price (main source of income)

• Sell 1 strike priceK ₁ = 262.5Call

• Premium received$4.9/shareThis Call is closer to the current stock price and is a major source of premium for the strategy. As long as AMD expiration price≤ $262.5, the Call will be completely invalid, and investors can retain all premium rights.

(2) Buy a higher execution price Call (risk protection)

• Buy 1 share strike priceK ₂ = 267.5Call

• Payment premium$3.5/shareThis Call is used to provide protection in the event of a significant rise in AMD's stock price, therebyLock in the maximum loss, to avoid the upside risk of naked selling Call.

(3) Call-side net income (per share)

Net premium = Sell Call − Buy Call = 4.9 − 3.5 =$1.4/share

Initial net income

• Net premium (per share):$1.4

• Initial net income (per contract, 100 shares): = 1.4 × 100 =$140/contract👉 The initial net income is the bear market call spread strategyMaximum potential profit。

3. Maximum profit

When AMD Expiration Price≤ $262.5Time:

• 262.5 Call and 267.5 Call are both out of the price

• The investor gets the maximum profit when both options are invalidated:

• Per share:$1.4

• Per contract:$140

4. Maximum loss

The biggest loss occurs when the Call spread is fully triggered, that is, AMD's stock price rises significantly. Strike spread width: = 267.5 − 262.5 =$5

Maximum loss (per share): = Strike spread − Net premium = 5 − 1.4 =$3.6/share

Maximum loss (per contract): = 3.6 × 100 =$360/contract

📉 Conditions of occurrence:

• AMD Expiration Price≥ $267.5

5. Break-even point

There is only one break-even point for the bear market Call spread: Break-even price = Sell Call strike price + Net premium = 262.5 + 1.4 =$263.9

Maturity judgment rules:

• AMD < 263.9 → Profit

• AMD = 263.9 → No Profit, No Loss

• AMD > 263.9 → Loss

6. Risk and return characteristics

• Maximum benefit:$140/contract (limited)

• Maximum loss:$360/contract (limited)

• Profit-loss ratio: gain: loss ≈ 140: 360 ≈1: 2.6

7. Strategic characteristics and applicable situations

Strategy Characteristics

• Bearish or oscillating bearish

• AMD is not required to fall sharply, as long as it does not rise significantly

• Receive time value by selling Call

• When opening a position, you can clarify the maximum return and maximum risk

• Compared with naked selling Call, the risk is significantly controllable

Applicable situations

When investors judge:

• AMD maintains a range in the short term or may fluctuate weakly

• Breakout before expiration$267.5Low probability of

• Hope inDefine the upper limit of riskObtain premium income on the premise of