Rocky’s Weekly Stock Picks
A lot of people prefer candlesticks.
This week’s stock picks are going to have a very clear focus. Priority #1 is getting at least 10% return this week. Priority #2 is preferring Cash-Secured Puts. We don’t give enough love to CSP’s. They really are the Yin to a Buy-Write’s Yang. Also, monthly options expire this week, expanding our opportunities for weekly income.
How Selling a Put works, you agree to buy 100 shares of stock for a certain price. You collect a premium, and the buyer knows that if the price goes down, they will profit from your purchase at the higher strike price. If the price goes up, you just get your money back.
UEC - Uranium Energy Corp. does exactly what it sounds like. They deal with exploration, mining, extraction, and processing. If you remember a few weeks ago, I’m all about nuclear energy. I’m looking at the $3 put again, with a $0.40 premium.
SENS - Gosh I forgot what this company does. Oh right, glucose monitoring implants. Dope. Implants are gonna be huge during Biden’s second or third term. For now I’m seeing a $3.5 Put with a $0.58 premium. I’d set the limit price to $0.60. Say the price goes down to $3 from $3.19, we still made $40 and got the 100 shares. I don’t see any possible downside here.
SNDL - $2 Put, $0.68 premium. Current price $1.40. I’ll set the limit to $0.70. Then next week I can write calls at $1.50, hopefully in the money, and make even more profit. If I only had $140, I’d buy-write at $1.50 strike with a limit of $0.20. Basically you can always increase the limit price by 1-2 cents (or decrease if you’re buying). Get in the habit of doing this now. The $4 extra profit per contract is a lot more significant when you’re trading 100 contracts at a time.
NAK - Northern Dynasty has been creeping back to the $1 mark. We’re at $0.75 right now. $1 Put, $0.29 premium. The $1.50 put with an $0.80 premium would be…not the worst gamble. In fact, since we’re good with paying $1, there’s no way we can lose here. Unfortunately, we can’t really win. I believe in NAK, but I don’t believe in its price doubling in a week.
CEQP - This is a bit riskier in terms of seeing an actual profit. For me, I’m totally fine with the $30 Put with a $4.45 premium. Price is $25.69. The thing is, I wouldn’t be exceptionally surprised to see the price move to $30 by week’s end. When that doesn’t come to pass, I’ll be alright with my acquisition. Additionally, CEQP pays a Rockydennis-approved dividend.
If you’re in this strictly for the USD, and don’t want to be holding on to any shares, I’d stick by these picks, but with covered calls. Also I would replace #5 with SEEL. I know nothing about the company, but if you bought 100 shares for $4.50, then sold a $2.50 call for a $2.50 premium….that’s over 10% guaranteed.
Apparently I can get into legal trouble for telling you that your return is guaranteed. I feel like that would just be free publicity. “Unknown self-proclaimed financial expert sued by SEC for misleading investors”. First of all, nobody is going to be upset… because they made their money like I said they would. Second of all, Joe Biden is President.
Joe Biden Showing Support for Donald Trump (Click here for Joe Biden’s Stock Pick)
