Archive Category: Max Profit Alert (Alerts)

The 2023 rally in tech stocks has been blistering hot. Year-to-date, the SPDR Technology Sector ETF (NYSE: XLK) is up 39%. Here’s a look at that fund’s top five holdings and their YTD returns: Microsoft (MSFT), +41%; Apple (AAPL), +48%; NVIDIA (NVDA), +199%; Broadcom (AVGO), +56%; Adobe (ADBE), +44%. I hope I don’t come off like a “hater,” but I just can’t fathom how these rates of return are sustainable. If Nvidia gains another 200% between now and year’s end, you can remind me and I’ll eat my words…

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I’m not recommending any new trades today. I’m watching a potential one, though… See, we currently have a small portfolio of “short” positions. That’s fine, and by design. Though I’ve been considering the value of adding a “right-tail” hedge. Right-tail, here, refers to the bell curve. Investors always worry about the left tail of the bell curve, where the very large losses show up.

Options don’t really allow for a “set-it-and-forget-it” style of trade management. You have to be more active in terms of taking profits on trades that are working well … cutting losses on trades that aren’t … and extending trades that are still valid, but need more time to work themselves out. Today, I’m recommending trade-management maneuvers on each of our open positions.

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