Option Trades for MSFT Earnings and Beyond

As we enter the last week of April, we have a big week for earnings reports. Among these, one worth watching is Microsoft’s report. Microsoft, which being a tech stock has inevitably been hurt by recent talks and implementation of tariffs, has rebounded. While it is still shy of its recent December high of $454, one who is bullish may see the stock poised to break through the 450 level. If you are one of these people, one of the best trades to make is the following 430/460/475 Call Fly, expiring August 15th. Historically, the price of this trader is on the slightly higher side, indicating a likely bullish sentiment in the market. Historically, the price of MSFT has been higher, yet after the recent dip we see it trying toi climb back to previous levels, as shown below: This trade has a high profitability probability, where if the underlying moves in the bullish direction, profitability is shown a while before expiration, allowing investors a wide range of time to make money. This is reflected on the heatmap below On the flip side, a bearish investor may predict there will be a weak earnings report which causes the value of the underlying to decrease. A bearish investor may target a strike of 315, and if they do, one of the best trades this investor can make is a 340/310/295 Put Fly 132, shown below Historically, the cost of this trade is lower than average, giving solid value to prospective investors The profitability of this trade is high, and assuming an investor is right about the direction, this trade offers a wide range of profitability, where an investor can take profits throughout, or hold till near expiration for even more. In conclusion, with the volatility that is abundant in the markets now, there is plenty of money to be made. While I do not have a crystal ball and cannot say which direction MSFT will move, we can offer the best options for either direction. And as always, keep in mind that it’s better to be lucky than good, so good luck…