A Schwab Network commentator unveiled a bearish, short-term option play on Apple (AAPL), while a guest on the same segment expressed bullishness about the stock market’s outlook.
A wide view of an Apple store, showing the range of products the company offers.
A Bearish Options Trade on AAPL
“Apple has the most exposure to tariffs” among large tech stocks, Schwab commentator Tom White said. He noted that the company’s products are manufactured in a number of countries that were hit with significant tariffs, including India and Thailand.
Further, he pointed out that the company’s AI initiatives have not borne much fruit, while its valuation “is still pretty rich.”
White suggested buying April 17 puts with a $205 strike price and selling $190 puts with the same expiration date.
Traders will pay a net premium of $4-$5 and have a break-even point of around $200, White reported.
A Veteran Investor Is Bullish
Investors received “certainty” about tariffs yesterday, and companies can find ways of keeping their margins elevated, despite the tariffs, said James Demmert, founder and Chief Investment Officer of Main Street Research. What’s more, the bull market, driven by “AI tailwinds” is still intact, and price-earnings ratios have become more attractive, he stated.
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This article is originally published at Insider Monkey.
