This is a FullyInformed Members strategy article on Microsoft stock. Over the past several days Microsoft stock has been on a tear but that ended last night when the news was released that PC sales had plunged in the past quarter. The news took the stock down hard this morning, yet believe it or not, Microsoft stock has been through this many times before. I quickly jumped in and sold naked puts for April 20 options expiry at the 28 put strike. With just 7 trading days to go the return of 0.85% was too good to turn down.
I marvelled at how easy it was to jump in and sell those Microsoft Stock puts with only a glance at my trader’s journal chart. I then saw that my profits for the past few years was once more on the verge of doubling. Over the past 10 years my profits from Microsoft have now averaged 25% annually. If I add in the bear market crash period of October 2008 to June 2009, the returns are almost double that.
Microsoft Stock 10 Year Chart
When you look at the 10 year chart on Microsoft Stock you can see that basically this stock has gone nowhere in 10 years. The excellent returns I make in Microsoft Stock through Put Selling and other trade strategies makes me wonder why so many investors buy and hold stock for the dividend alone and pray it all works out.
Microsoft Stock now pays out .92 cents in an annual dividend. I cannot imagine risking my capital for 92 cents annual payout and the hope that someday the stock will be worth a lot more than what I paid for it.
Color Coding Success in Microsoft Stock
Ten years ago I developed a very simple color coding system which I can apply to a variety of stocks to assist me in the decision-making process for trading Microsoft Stock. It was this system that this morning told me not to hesitate but to get in there and sell the April 20 $28 put strike. This is the same system I have used on YUM Stock, PG Stock, JNJ Stock and others, for years. It is this system that I can glance at to make a quick decision on everything from Put Selling to buying and selling the stock.
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