Using options to trade Microsoft with long term bullish view
Here's a no-fluff take on how someone with a long-term bullish view on Microsoft (MSFT) can play the earnings announcement using options
The Big Picture MindsetYou already believe MSFT is going higher over the next 6–24 months.
Earnings is just a potential catalyst (or speed bump).
Your goal isn’t to bet the farm on one print — it’s to get a little extra juice if things go your way, while keeping most of your risk controlled.
Three Practical Ways Long-Term Bulls Often Play Earnings1. The “I’m already long and want more upside with limited extra risk” playBull Call Spread (debit spread) bought a few days before earningsBuy a call closer to the money (say current price $460 → buy the 465 or 470 call)
Sell a further OTM call (say 490, 500 or even 510 depending on how greedy you feel)
Usually 7–21 DTE (weeklies or next monthly)
Why it fits a long-term bull: Costs way less than buying a naked call
If MSFT rips post-earnings you still get very nice leverage
If it gaps up modestly or even stays flat → you lose only the debit paid
Max loss is defined and usually small compared to your overall position
Typical vibe: “I’ll be happy if it goes up a lot, I won’t cry much if it’s just okay, and I’m not blowing up if it gaps down.”
The “I want to buy the post-earnings dip if it happens” playSell a put credit spread (bull put spread) right after the earnings moveWait for the initial reaction (often over-reaction), then: Sell a put ~3–8% below the new price
Buy a further OTM put for protection
Example: MSFT gaps down to $435 after earnings → sell 420/410 put spread for nice credit.Why it fits the long-term bull:
You’re basically getting paid to take the position you already wanted (owning MSFT lower).
If it keeps tanking (rare for MSFT), you have a floor on the loss.
If it bounces (what you expect long-term), the spread expires worthless → free money.
The classic “I’m super confident this print is going to be strong” playLong call (single leg) + hold core sharesBuy slightly OTM calls (maybe 5–10% out) with 14–30 days left
Size it small — usually 10–25% of the notional value of your shares
Plan to sell into strength the day after earnings or within 2–3 days
This is the most aggressive of the three.
Use it only when you have very strong conviction (AI momentum still ripping, Azure numbers looking juicy, guidance raise very likely, etc.).
Few Practical Tips That Actually MatterDon’t size like it’s a lottery ticket. Even if you’re dead right, implied volatility crush after earnings can eat 30–60% of your extrinsic value in minutes.
Prefer 2–4 weeks till expiration over weeklies → less gamma/theta murder.
Exit discipline beats entry genius. Have a plan to take profits at +80%, +120%, +200% etc. Most people give it all back waiting for “just a little more”.
If you’re very long-term bullish → the put credit spread after the print is usually the highest expectancy play statistically for big-cap names like MSFT.
Bottom line:
Use earnings as a way to juice returns a bit or get paid to add to your thesis, not as a make-or-break moment.You’re already betting on Microsoft for the next few years.
A well-structured options play should just be the hot sauce — not the whole meal.
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