A decrease after after the symbols in the AMD stock? Here is how collar options can prevent pain.

Imagine you to say this to yourself in the best evil voice: “This is a beautiful profit for you on this arrows there. It will be a shame if something happens.”

This sound in my mind settles every time I have a situation like this that I assume that many are in advanced small devices (AMD). However, the concept that I will show here is a strategy that can be applied to any shares or ETF that has a reasonable liquid option market. I can use Screener Barchart Options frequently, whether to find good white -collar settings on the names I follow, as well as to determine if they are liquid enough.

This last question is a matter of personal preference. For example, if the bid is on a small option, and you are a self -guided investor, it is likely that you will not buy hundreds or thousands of contracts. So you can get what you want most of the time, in terms of trade size.

The arrow of the semiconductor maker has gained 66 % in the past three months only. Like this, it is far from the first time that it has occurred. The last time has happened from late 2023 to early 2024. AMD had had several switching by 50 % since the epidemic in 2020.

However, there were many decreases by 25 % -35 % during that period. Let’s face it, this is a volatile stock. Regardless of the basics, AMD is trading like most stocks today: a little on the basics, but it depends a lot on market morale towards what the company does, how its industry, its sector and the broader market are based.

All this rings the alarm bell for me. I bought AMD again on June 9, slightly over $ 120. So at $ 177 on August 4, I was concerned. Now that I invaded the climb at AMD, I was looking forward to her collar.

For full disclosure, I collected AMD from the moment you bought the arrow. But since this is my teaching, let us assume that I did not use the options and simply got a great gain on AMD.

This graph is not terrible. Just exaggerated. But when I see this kind of distance to the moving average for 150 days, this calls for a respectable offensive position in the stocks.

This was the daily chart. Amd’s Weekly (below) does not look quickly for me either. The PPO index is very high, but it has not yet threatened to roll, as he did to mark in early 2024.