In fact, today we’re actually going to talk a little bit about hedging bets, the pros and cons of doing so, and what it could mean for your trading and/or investment career.
While buy-and-hold investing can be considered boring and high-risk to many individuals, long-term investment strategies aren’t limited to buying a stock or shorting a stock, holding it for two years, and closing out.
| Ticker Code | Ticker Name | Ticker Industry | Price Change | Average Volume (50)* |
| DIS | Walt Disney Co | Entertainment | 8.50% | 20,703,021 |
| WYNN | Wynn Resorts, Limited | Resorts & Casinos | 24.38% | 7,145,359 |
| RHI | Robert Half International Inc. | Staffing & Employment Services | 16.41% | 1,935,641 |
| NCLH | Norwegian Cruise Line Holdings Ltd | Travel Services | 8.67% | 42,851,645 |
| PG | Procter & Gamble Co | Household & Personal Products | 1.93% | 11,776,921 |
| LUV | Southwest Airlines Co | Airlines | -39.92% | 21,773,773 |
| BABA | Alibaba Group Holding Ltd – ADR | Internet Retail | 1.02% | 16,633,716 |
| F | Ford Motor Company | Auto Manufacturers | 0.82% | 102,699,950 |
| DSS | Document Security Systems, Inc. | Specialty Business Services | 97.77% | 7,834,881 |
| COST | Costco Wholesale Corporation | Discount Stores | 6.51% | 3,655,699 |
| MARK | Remark Holdings Inc | Internet Content & Information | 58.06% | 22,032,224 |
| AAPL | Apple Inc. | Consumer Electronics | 16.28% | 42,131,255 |
| BA | Boeing Co | Aerospace & Defense | -15.93% | 40,570,122 |
| SHOP | Shopify Inc | Software – Application | 42.31% | 3,906,923 |
| GRUB | GrubHub Inc | Internet Content & Information | 9.27% | 3,413,292 |
| ETSY | Etsy Inc | Internet Retail | 49.81% | 4,416,265 |
| DAL | Delta Air Lines, Inc. | Airlines | -31.60% | 60,357,818 |
| BBY | Best Buy Co Inc | Specialty Retail | 25.25% | 2,755,894 |
| BUD | Anheuser Busch Inbev NV | Beverages – Brewers | -3.98% | 2,774,259 |
| SPXC | SPX Corp | Specialty Industrial Machinery | 12.56% | 343,345 |
One can also place hedged bets using options spreads with expiration dates as far as two years out from now – more on that to come – but in the world of passively trading blue-chips, it’s a strategy which has increased in popularity ten-fold over the last few years.
What placing an options spread does is reduce your acquisition cost (options are less expensive than blue-chip stocks), and protect your downside from a total loss… that is unless the investment firm you’re doing business with “forgets” to protect the downside for you.
That’s exactly what happened to a select group of traders and investors in Wynn Resorts (NYSE: WYNN) through its recent 76% decline through the coronavirus pandemic.
As a result, Klayman Toskes has launched an investigation focusing on full-service brokerage firms, many of which failed to supervise the management of positions on Wynn Resorts in particular for their clients.
As an unfortunate result, multi-million dollar losses have been reported by retail investors.
But that doesn’t mean we can’t take advantage of Wynn’s current price action for a short term trading opportunity to wrap up the week…
As displayed on the chart above, WYNN is currently trading above $80/share support.
Should WYNN hold $80/share support into today’s opening bell, I’ll plan on making a bullish trade with the simple goal of stretching my position for maximum profit potential, to be paid in full by the end of the trading day.
Happy trading and I hope you’ve had a great week!
Yours for TrackStar trading,
Davis Martin
America’s #1 Premarket and Day Trader
Disclaimer: This is not investment advice. This article is for information purposes only and opinion-based on financial advisor data across a selection of websites. Investors should be cautious about any and all investments and are advised to conduct their own due diligence prior to making any investment decisions.