To The Moon

A friend of mine, who waited a long time for a pullback in Nvidia's stock price, but later found that the stock price was getting higher and higher, and the current price trading feels a bit of a loss, and asked me what to do.

Then I shared the following big order with him:

sell $AMD 20230818 140.0 PUT$

Option expiration August 18, strike price 140.

sell $AMD 20230915 135.0 PUT$

Option expiration September 15, strike price 135.

How to evaluate these two groups of sell put strategy. For institutions, it is more cost-effective to sell "high" ATM or ITM put within the price of a strong stock than to hold it directly. This choice also indicates that they believe the probability of a major decline is low.

Some people may ask if they have sold 140put, why not buy 140 call? I went to check, and indeed someone did this strategy, buy 140 and sell 170:

• buy $AMD 20230818 140.0 CALL$

• sell $AMD 20230818 170.0 CALL$

In short, if AMD's share price does not fall, so does Apple's share price, it is difficult for the overall market to fall.

In addition, these sets of strategies also side evidence that NVDA may really continue to hit new highs in July.

If you feel that the ATM put is also difficult to bear the risk of taking orders, you can consider OTM:

sell $AMD 20230728 105.0 PUT$

The second most common operation is the sell call, but considering the market is too strong, the sell call large single exercise price is only for reference.

sell $GOOGL 20230721 140.0 CALL$

If you feel that the risk of selling ATM is too high, you can also add a leg to hedge, such as this strategy of Tesla:

sell $TSLA 20230707 255.0 PUT$

buy $TSLA 20230707 220.0 PUT$

The option expiration date for this order is July 7, and not choosing a further date indicates that the agency is not confident about the July FOMC. Judging from the big orders in the past few days, the FOMC in June really has no impact