BY ANDREW GIOVINAZZI
May 8, 2024
Yo Pit Crazies,
If you have not done so, hit up Licia Leslie and her Pitchfork extravaganza. You need to find the range to trade it!
Robinhood Markets Inc (Ticker: HOOD) has had its share of roller coaster rides up and down over the years. It started life as the favorite refuge of Stimmy Dollars in 2020 and came out with a blockbuster IPO IN 2021. Meme stocks and HOOD were one in the same for a whole year. Then they got squeezed margining Gamestop Inc (Ticker: GME) and some bad press and selling hit the stock hard.
All time chart of HOOD
Fast forward to the crash of 2022, rerise of Crypto and some years just getting the management down and HOOD is finally a profitable company even when charging $0 for execution. The stock was up after hours on a ho hum day Wednesday with SPX dead flat on the day.
HOOD earnings really blew the door off the hinges. I added a HOOD put diagonal in our Pro Chat Room last week. It will likely give me free puts until Jun.
Now what do I do with them
I will write more puts against them!!
The HOOD May17 15.5 puts will be worthless today and I will sell some others closer to the money. The out of the money diagonal spread is a great way to buy a stock at a lower price with some capital protection built in.
Only use this spread with quality companies. Now that HOOD found a way to make money charging nothing, I think we see mid 20’s this year.
To Your Trading Success,
-AG
Andrew Giovinazzi
30-Year Trading Pro
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