Editor’s Note: Tom Gentile is no stranger to delivering massive winning plays on FANG stocks like 270.37% on AMZN, 136.59% on GOOGL, and 100% on FB. It’s really no surprise, considering these windfalls are backed by a method so unique, it’s in the process of being granted a patent by the United States government. Now, these moves happen fast, so I urge you to go here now to learn more about the next money-doubling opportunity.
The tech sector is one of the fastest moving markets in the world…
But there are four stocks that rule the roost of this ever-growing sector, and most recently, they rocked the market with their earnings reports.
And while they can make you some major profits -they can also crash your portfolio unless you know how to play them right…
You’ve probably heard about a group of stocks that have been dubbed “FANG” by many analysts. This group is made up of four of the most powerful and high-performing stocks in the market.
And these stocks are can dictate the market in a blink of an eye…
So that’s why today we’re going to take a closer look at these stocks so you can know exactly how to play them….
First up we have Netflix, Inc. (NASDAQ: NFLX)
NFLX was climbing higher before it’s more recent earnings report…
But then, the streaming giant missed its projected subscriber growth by over a million and the stock felt the shortcoming as it dropped quickly after the news.
Following this, Alphabet, Inc. (NASDAQ: GOOGL) was the next FANG stock to release earnings.
Except they didn’t follow after their streaming counterpart – because this search engine giant knocked their earnings out of the park.
Out of the gate, the stock climbed higher, but the momentum didn’t stick around and GOOGL fell shortly after its bullish move.
Many investors were shocked at this sudden drop, but the truth is, there’s a good reason why it fell regardless of a good earnings report…
And that reason is Facebook, Inc. (NASDAQ: FB).
FB has been the black swan of the FANG this go around….
You see, while the company’s earnings didn’t reach expectations – the numbers and drop in the stock was expected.
But what caught investors off guard was the two words that the chief operating officer of FB focused on during his post-earnings announcement – margin cuts.
From there, the stock moved down on a bearish tear and dragged many stocks with them.
But the final component of FANG didn’t feel the weight of its counterparts stumbles – and that was a very good thing.
You see, Amazon.com Inc. (AMZN) was the final FANG stock to report earnings. Many worried that the company would fall short of projected earnings. And here’s the thing, if AMZN tumbled – there was change it would drag much of the market down with it.
Luckily for investors, the online giant blew expectations out of the water and jumped to new highs while it was at it.
Regardless of the ups and downs we faced for FANG over this earnings period though, this experience really brought me back to the very core of my trading game. My three simple rules for both trading and investing:
- Spot rules based opportunities but know that not every opportunity is guaranteed 100%.
- Be comfortable with the amount of risk you’re taking
- Plan, execute, and manage your trades.
But at the end of the day, a lesson to be learned from FANG is this: no matter how well you plan, how well you spot rules based opportunity, or how well you create an acceptable risk trade, everything can change in a minute and you have to be prepared for that.
And, it’s exactly why I preach the importance of “flipping stocks,” rather than outright buying them.
Plain and simple, traditional forms of investing like the old buy-and-hold method Wall Street wants you to use will get you nowhere, and fast. That’s because they’d rather be in control of where the real profits are… which is in options.
You see, with options, you can actually control 100 shares of expensive stocks like Amazon.com, Inc. (AMZ) for less than $500… so while Wall Street wants you to shell out over $87,000 for 100 shares of AMZN., you don’t have to if you want a chance to profit from FANG stock moves
— The Option Specialist