Here is Why Millionaires Keep Visiting Paris:
If there is a city you should visit while you are young, it is Paris, France. Words cannot describe just how incredible this city is. Romance, great food, incredible architecture, style, fashion, and HISTORY. You will feel like you just reached back through time, and you will fall in love with it ALL.
This photo will always have a special place in my heart: Les Champs-Elysées middle of the road looking at the Arc de Triomphe with a green light.
FIRE BABY – CFU!
But let’s get into what happened this week in North America with one of the biggest box store retailers!
Target hits on expectations, but then shots a blank on guidance
Target’s earnings exceeded expectations this week, boosting its stock. But the company warned of slow sales ahead. Comparable sales fell for the third straight quarter, dropping by 4.4% in Q4. Target predicts a further decline of 3% to 5% in Q1, with flat to 2% growth for the year.
Despite this, Q4 earnings per share (EPS) hit $2.98, beating the expected $2.42, with revenue at $31.92 billion, slightly above the $31.83 billion estimate. Target forecasts adjusted EPS of $1.70 to $2.10 for the current quarter and $8.60 to $9.60 for the full year.
Net income rose 58% from the previous year, reaching $1.38 billion in Q4. Operating income margin improved to 5.8% from 3.7%.
Target faces challenges from declining discretionary spending, unlike Walmart, which thrives as the top grocery seller. Target’s focus on non-essentials makes it more susceptible to changing spending habits.
To attract budget-conscious shoppers, Target introduced a new line of low-cost essential items. CEO Brian Cornell is optimistic about “solid progress” in growing traffic and reviving Target’s growth.
Target’s struggles with theft and inventory errors led to store closures in major cities. Analysts doubt Target’s claims, suggesting the losses might be due to internal mismanagement rather than theft.
Trading Strategy of the Week:
If you’re looking for a way to potentially profit from a stock’s stability or upward movement, put credit spreads are a fantastic way to make money. All while staying fully hedged. This options trading technique offers a defined risk and reward setup, making it appealing to both novice and seasoned investors alike.
So, what exactly is a put credit spread?
Put credit spreads involve selling a put option while simultaneously buying a put option with the same expiration date but at a lower strike price. This strategy is executed for a net credit, hence the name “credit spread.” Here’s how it works:
Identify a stock or ETF you are bullish on: start by selecting a stock or ETF that you believe will either remain stable or rise in price over the short to medium term.
Choose Strike Prices and Expiration: Next, select two put options with the same expiration date. Sell a put option with a higher strike price and simultaneously buy a put option with a lower strike price. The difference in strike prices determines the spread width.
Receive a Credit: Since you’re selling the higher strike put option for more than the cost of the lower strike put option, you’ll receive a net credit to your account. This credit is your maximum potential profit.
Manage Risk: The maximum potential loss is limited to the difference between the strike prices minus the net credit received. This defines your maximum risk in the trade.
Wait for Expiration: If the stock price remains above the higher strike put option at expiration, both options expire worthless, and you keep the entire credit as profit. However, if the stock price falls below the lower strike put option, you may face losses depending on how far the stock drops.
Close the Position Early: To mitigate potential losses or secure profits, you can close the position before expiration by buying back the short put option and selling the long put option. This action locks in gains or limits losses based on market conditions.
Put credit spreads offer a balanced risk-reward profile, making them popular among traders seeking income while managing risk. However, like any options strategy, it’s essential to understand the potential risks involved and have a solid grasp of market dynamics before executing trades.
Here is an example trade we recently executed at CFU:
STO LRCX 032224 975 PUT
BTO LRCX 032224 970 PUT
Limit Credit 2.65 and this order filled.
This will generate a total return of 112% on risk should LRCX end above 975 by March 22.
CFU Results from Last Week:
50 PROFITABLE TRADES!
MEMBER RESULTS:
Member’s booking profit and learning to trust our system:
CLOSED AND REALIZED PROFITS 💰
Our community is fiercely focused on booking you monthly profits.
We are currently not accepting new enrollments but be sure to keep an eye on joincfu.com for alerts when we open the doors for more members to join us.
Stephen
President, CFU
