Are you zooming for income?
Zoom Video Communications (NASDAQ: ZM) has exploded onto everyone’s radar from the Covid-19 pandemic.
That’s not a surprise. The company’s remote conferencing services have been in high demand as people across the country were working from home to help stop the spread of the coronavirus.
Perhaps you are using it for work right now.
And you’ve seen Zoom in action if you’ve ever attended an Options Income Blueprint Live Trading Session. I hosted a dinner with friends last week via Zoom, as well as a coffee break with family. And my wife’s personal training session this morning was conducted on Zoom as well.
You get the point. So does Wall Street. That’s why shares of ZM have more than tripled this year.
By the way, shares of Zoom Technologies (OTC: ZOOM) — a Chinese holding company — have skyrocketed as well. In fact, they are up nearly 900% as people have mistaken it for Zoom Video Communications. So, please make sure you have the ticker right.
I shy away from overhyped stocks. But this is not a fad.
An analysis done by the University of Washington School of Medicine projects more than It projected 169,890 could die of Covid-19 by October 1 and are uncertain when the deaths may subside.
In other words, the coronavirus isn’t going anywhere anytime soon, and many businesses will continue to rely on Zoom to keep operations going.
What’s more, Zoom Video has emerged as the standard for teleconferencing, and I believe this will continue when the pandemic ends.
The company offers a robust yet easy-to-use interface with both free and paid options. And it’s nothing short of a technical miracle that the platform has functioned seamlessly despite the enormous increase in usage in recent weeks.
While the company is not speculative, the stock is.
To reduce risk, we sell what I call a “Silly Put” … a put option at least 10% to 15% out of the money that throws off an annualized return of 15% or more.
There are a number of “pandemic” stocks that are great for selling options for rich premiums. I like Zoom because it has rewarded income investors almost every week for the last 3 months.
Shouldn’t you be zooming for income?
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About The Author
Michael Shulman is a 30 Year Veteran of the financial markets – as a trader, a financial analyst, a financial writer and most recently as an educator.
Mr. Shulman made his first option trade in 1985 – COMPAQ Computer calls – a position that expired worthless. His second trade broke even; the third brought him a year’s salary, a near twenty to one return on his investment. Michael has never looked back. He entered the financial publishing business formally in 2001 as director of research for ChangeWave Research’s institutional research business and as the writer and editor of Hedge Fund Investing.
He has published two books – Sell Short and Made in America – both of which can be found on Amazon.com and is a frequent contributor to reputable financial sites like Seeking Alpha, MSN, MainStreetInvestor, and Traders Reserve.
His trade recommendations in his Options Income Blueprint, Perpetual Income Portfolio Club and Income Masters services maintain a 98% success ratio, meaning his trades produce the expected income 98% of the time. No one’s perfect.