Transcription
We have a chance to make even more money on Palantir. The stock has been going up every single day; it's over $70 per share. I call this play, but I'm also going to call a new play where you can make money using LEAPS, and there's a special opportunity that's setting up right now that I'm going to go over in this video. I'm really excited because we're about to make money hand over fist, bicep over tricep. I'm super pumped up because what I'm seeing right now can really rake in a lot of premiums. In this video, I'm going to walk you through exactly how I'm going to be using options to play Palantir in a very smart way because it is reaching all-time highs. I am very cautious in some ways, which is why I would say you should be doing LEAPS or nothing right now. Literally, LEAPS or nothing right now.
I'm telling you the reason why you want to go LEAPS or nothing is because having your money stuck in Palantir right now is kind of like dead money. Dead money means you have a whole bunch of capital tied up, but I don't think the stock is going to have too much more upside. If it does, it'll have fast upside at a higher level of risk. By the way, before I go into this LEAP strategy, I am having a webinar this Saturday going over my entire LEAP strategy with seven plays that I don't have on YouTube. I'm going to be spending two hours of time just basically going over the LEAP plays that I have, why I'm doing them, and teaching you guys a lot on a Zoom call. So go ahead and check out the first link for that.
Now, I think right now it's not too late to jump into LEAPS on Palantir, and this is a very special opportunity. Let me show you an example of why I think this is the case. By the way, I've been making over 15% per month in this market right now. You guys can see that I'm up $253,000 on Palantir. If I had used LEAP options on Palantir with my entire position, I would actually be up a lot more money. So instead of having shares, instead of having these 5,000 shares, had I been in LEAPS from the very beginning, I would be up way more money—probably like $750,000. That's because LEAPS have a leverage factor; they give you 3x the return.
So let me show you what I'm going to be looking at right now. Palantir is at over $71 per share; it's been up like a complete monster. This stock has a lot of reasons for it. I can go over the reasons; let me just show you the play first because I respect your time. Today, I'm going to mix it up a little bit. I'm going to go with the option play first and then the reasoning why later.
All right, so what I'm going to do is I'm going to go for a December 27 expiration. We're going to have an end-of-year play. Let's say that the end of the year, and I said December, is going to be a huge month. I've been right so far; we're only a couple of days into December, but I said it's going to be a huge month, and we're right on the money right now because momentum is high. One of the most important factors in the market is momentum. When I was working for a hedge fund, the guy told me that the higher momentum is, the more likely the stock is likely to continue having that momentum.
So there are only two plays that are going to make sense. I'm going to show you something really unusual. By the way, first, I'm going to go to buy a call option. I would say that right now you can have a LEAP option for a short-term and a long-term play. So I'm going to show you three different positions—not two, actually, excuse me. I'm going to show you even more than what I said. So for December 27, you can go in with the buy call option.
Now look, I would not hold this up until expiration. Okay, let me explain. If you hold an option until expiration, more often than not, they do expire out of the money. That's why buying options is risky because oftentimes they expire out of the money. However, nobody said that you have to hold an option up until expiration, guys. It doesn't make sense. What does make sense is if you see the stock moving higher, like Palantir, with clear momentum—like it goes up 6% in a day—you can bet that that can happen again. If it goes up another 7%, which is getting less and less likely, but in this type of bull market, you can see that the end of a bull market is where a lot of profit is realized.
A lot can be dangerous, which is why I'm saying don't put a lot of capital on this position. Just buy several call options and ride those call options, and close them really early. What I mean by early is literally this is expiring December 27th. I would just jump in for like a week. Now, this is something that I would consider as a fun play but also a very high-profit potential play because there's very little capital that you have to put at risk here. If you buy a couple of call options, just two, it's only going to be $365 per contract. So two contracts is about $700, and if this stock pops under 7%, you're essentially going to see the stock go up by about $5, but this option will go up by about $35.
So, you know, or $25 actually because the Delta here is 0.5. So if the stock goes up by five, the Delta of 0.5 means that the option will go up by $2.50. So if you put up, you know, $365 and it goes up, you know, $2.50, that's going to be about, you know, 75% return. So not quite a double on your money, but thereabouts. You can basically turn like $700 into like around $1,200, which is a really nice gain. That's like $500 on a really, really tiny amount of money. Imagine if you 10x that, and depending on your portfolio size, if you're working with six figures—which is the majority of folks that I work with: lawyers, doctors, engineers—you guys can put in a five-figure amount into a play like this because you have a six-figure portfolio.
I've seen guys making so many multiple five figures in these months because in a bull market, again, you want to take advantage of the hotness. It's not always like this. I mentioned in my last video, it's like basically right now there's been a lot of rain on our farm; all the fruits and veggies are growing. There's so much abundance of fruit; you have to take them and freeze them for the winter because it's not always going to be this hot.
Okay, so when there's money to be made, take it. We're basically taking these filled barrels, okay? We're putting all the money up in there; we're like, "All right, this is ours." All right, the fruits, the veggies—we're just missing the protein. All right, so that's what you want to do right now on Palantir. I want to say that I'm paying very close attention to the stock, and I'm actually paying attention to what the insiders are doing.
Okay, by insiders, I mean someone like Ken Griffin, right, from Citadel Advisors. Back in September, actually, he ended up selling off 5 million shares, and guess what? My man was wrong. He was wrong. I ended up making way more money, you know, percentage-wise than many hedge funds because many hedge funds cut something like Palantir, which is a really stupid move. So Ken Griffin did that. De Shaw, right? David Shaw, he's another hedge fund billionaire that basically trimmed the stake in Palantir during the third quarter, which he sold off 8.7 million shares.
So the reason why I'm saying that some people are selling off, some people are buying, is because when there's so much volatility, this is the perfect opportunity where you want to jump in to buy some call options because there's a lot of controversy. There's a lot of controversy; there's a lot of volatility. You can actually do two things, and you should be kind of buying options on Palantir. By the way, you can buy calls and puts. Let me explain.
All right, so this position right here to finish off my first trade: 72 call—just jump in. Do not hold until expiration. I would just give it a week, and if Palantir goes up, cut the position, take profit, you're out, you're good. I'm just trying to squeeze out as much money from the bull market as possible. So we will get in, get out, we're good.
All right, now the next play that I would make is Palantir is a good long-term play. Let's just be honest; it is. It's been, and I've said it's been since IPO. Since IPO, guys, since I said that. All right, buy call September 19. You know, look for a LEAP option; you do want to go in the money. So I'm going to scroll down here to 62 A2, and this is a 70 Delta. So this right here, if you put up $22, which is about $2,200, it's a lot better than putting in $77,000 in buying the stock.
So again, 3 to 5% of your portfolio—5% would be on the little bit of the higher end, 3% of your portfolio, no problem. So if you're working with $200,000, you put in, you know, six grand, you buy three contracts here—nothing wrong with that, right? And you do not also have to hold this until expiration. In all buying scenarios, I usually don't hold until expiration. I pick an exit point where I'm happy with the profits.
So for example, let's say that Palantir goes to $80 per share in the next two to three months. All right, in February, it's at $80 per share, and the stock went up basically $9. My option went up, let's say, by $6, right? Because the option's not as sensitive as the stock; it's not going to move dollar for dollar. It's going to move about 71, which is the Delta, right? So Delta actually measures how much the option moves.
So the option is up, so if the stock is up $10, the option would be up about $7. That's how it works; that's what Delta is trying to say. Delta has two definitions. The first definition is the sensitivity that the option has when the stock moves, and the second definition is the chances that the option will expire in the money. So clearly, the Delta here is 71, which means that there's a high chance of it expiring in the money, which is a very, very good thing.
Now, what I would do in February, if this option were to be up, you know, $6, that would give me a really good return of about 25%. So in 2 or 3 months, if I'm up 25%, listen, I'm not complaining, guys. I'm making money hand over fist. 25% is not bad just to take profit, especially because I do think Palantir will be peaking at some point. This stock cannot just go to the moon; fundamentals do matter, and stocks aren't rocket ships like Elon Musk's rockets, right? They have some type of center of gravity from a physics perspective.
Just when it comes to stock investing, they have something called mean reversion, which means that a stock will come back down to its mean. Now, the mean is just the average of what it's worth, right? But Palantir continues to be worth more and more because revenues are rising. So I'm still very bullish on it; don't get me wrong. But we're not going to go to, like, you know, a trillion dollars overnight. So it's going to take time, and if you jump in with this call option, the 62 A2, I would hold it for one or two months.
If you want exposure to Tesla without having to buy 100 shares and, you know, put up all this capital, you can put up a lot less capital. Now, what I'm going to show you as well is actually, in addition to having these call options, you can hedge your position by buying some put options or potentially put debit spreads.
So let's say that you're fearful, and this is—I don't personally do this myself, but I think this does deserve a position in your portfolio. Okay, maybe it's on Palantir; maybe it's something else. When you have a big position, use a strategy like this. All right, so I'm going to go for January 17, 44 days out. And look, this is going to be buying a put option or a put debit spread.
All right, so you can buy something really simple and hedge at $70. This would be expensive, right? This is $470; that's a fairly expensive hedge. So what you can do instead is we're betting on Palantir going up with the LEAP option, right? But let's say that it pulls back. Well, you also want to win on that. You want to win on both sides. I'm trying to create as much winning potential as possible. I'm trying to put you in a winner's position, right? So it goes up, you make money; it goes down, you're like, "Well, you can also make money," or basically cover some of the cost that you have for buying a call option.
This is an interesting way because now I'm buying options from both sides. I'm buying a call option on the upside, and I'm buying a call option on the downside. Specifically, when does this make sense, and when does this not make sense? Listen, guys, this makes sense right now in this market because we have so much volatility. The stock is going to pop a lot higher.
So unusual events like bull markets—which, by the way, I consider a bull market kind of an unusual event because typically we don't see 15-20% returns in a month. This is an insane market, but it's also a good market, right? That's besides the point. When you have this type of activity, it's likely to continue a lot higher and be hot, or maybe we'll get a bear market or a crash. That could happen like this, guys. Don't underestimate the market.
When I was working at Goldman Sachs, the adviser that I was working next to told me, "The market's job is to make the most amount of people look stupid." I was like, "Whoa, that is a very bold statement. The most amount of people to look stupid? I thought the market was about making money." He's like, "It is for the smart and the rich."
Okay, but if you want to make money, let's say you're doing well, but you're not a multi-multi-millionaire or billionaire. Well, you got to be smart. You got to be smarter than the rest of the people. You need an information advantage; you need a strategy advantage. You need to have advantages in this game. This is the most competitive game in the world. Everyone wants to make money.
So look, this is what I would do: you can buy a 70 put option, but I would also sell another put option and create a put debit spread because it's going to be a lot cheaper. So instead of putting up $470, if you end up selling the 65 put here, okay, this is going to create a put debit spread position, and now your cost goes down because, well, when you sell a put option, you collect some income, right?
So you're buying a 70 that's betting on it going to 70 or below, but it's not going to—I don't think it's going to crash. Palantir could go down, but you know, it'll go down; it'll reach a support level at 65, right? I did my research before this video because I respect your time. I try to go fast in these videos. So if I buy a 70 and I sell a 65, that 65 will subsidize or reduce the cost of the $70 put option that I'm buying.
So instead of putting up $470, I am going to basically sell a put option, and when I sell that 65 put option, it reduces my cost all the way down to just $217. So again, if you go ahead and buy three LEAP options on the first example I showed you or the second example I showed you—the first example was just a call option, a regular call option; the second one was a LEAP option, right, for September, which I consider a LEAP.
Guys, most people will say, "Oh, a LEAP is only one year," but no, a LEAP is just a long-term call option, right? For me, nine months is significantly long-term. All right, so first, you buy a call option; second, you buy a LEAP option, and then you jump in with a put debit spread. You can do all three of these trades. This is probably what I'm going to end up opening up in my own portfolio. I already have a lot of Palantir, and I've been early, so you know, I can only open up so much of a position.
But I'm always making these videos for you new guys that, you know, I hope you guys obviously subscribe, and I hope to keep making you guys money. Now look, let me wrap it up now with the explanation of why I think Palantir is a good stock and why I cover this stock. I've been covering Palantir since IPO, and recently they've had the best quarter ever—like literally the best quarter ever.
When it comes to results, it is mind-blowing what Palantir is doing right. When I look at their commercial revenue growth, when I look at their government contract revenue growth, I've never seen this happen before. This company is going to be a trillion-dollar market cap; it's just a question of when, right? And I think right now it's an opportunity for LEAPS to jump in to get that growth up into the future.
I do think it's still a good time to buy Palantir shares and hold for the long, long term. In the short term, again, we're going to see volatility. I pretty much guarantee we're going to see volatility. It's unlikely that a stock is just going to go sideways. Palantir is not a stock that likes to go sideways. This stock has a personality. This stock has a lot of personality.
When I say the stock has a lot of personality, let's be honest: the investors trading the stock have a lot of emotion, and that's what the stock market's about. You have a lot of people that think the stock will go up, and that's what actually makes it go up because you see a lot of buying volume. People are putting money. Guys, this game is psychological, right? It depends on what other people are doing, and that's why these videos that I'm making are very important because I have a very clear signal of what's going on with Palantir based on the investors in my Discord community, based on the folks I talk to on Wall Street.
You know, after working at Goldman Sachs, I still have connections there. I'm still talking to people every single day, right? I have friends there. "Hey, how's your investment banking job?" Right? They're slaving their job; they're saving their life away in an office. But hey, you know, I chose option trading because I can do it remotely. I can do it anywhere in the world, and that's been my dream—to basically have a lot of freedom.
I value freedom more than money. It's not even the money that I was after; I was after freedom, right? I have enough money. Making more money to me—make another million, $10 million—it doesn't change anything. I am in Dubai right now traveling, but you don't need millions and millions of dollars because with options, if you can just produce 5-10% a month, right? You have a million dollars; you don't even need a millionaire. You can have $400,000. 10% is $40,000 a month. That's enough to live in Dubai; it's enough to live anywhere, right? It's enough to travel; it's enough to have freedom.
It's enough to not need a 9-to-5 job. It's enough not to even be a lawyer. It's more than most lawyers make, right? I have so many lawyer clients that, you know, they go from case to case where they have to work really hard, and then maybe they get a $50K, $100K payout. Well, with option trading, you can make actually more consistent income than even many of these high-level positions. It just makes a lot of sense.
And then also, the last thing that I want to say is that when I take a look at what's going on in our post-election cycle, I'm very, very bullish, right? Because look, with the Republicans, Republicans like bigger governments, right? We've seen that before. They come in, right, like Donald Trump, and he makes the office bigger; he makes government. There's just more government spending. They love to spend money, and the deficit will go up, right? But that money being spent, trust me, believe me, I'm telling you this right now. I've seen it from facts. The government spend is also going to go to defense. Defense is going to go into Palantir's pocket, guys.
This is not even rocket science; it's just pure facts. Look at what the Republicans did last time: they spent a lot of money, right? And I'm not saying that's good or bad; there are actually pros and cons, right? But let's just be honest where that money is going to go. It's going to go to healthcare, and it's going to go to defense. All right, so on the defense side, Palantir is going to make money hand over fist, bicep over tricep, and that's going to flood your pocket with money.
That's going to flood your pocket with money, and when you jump into option strategies, you will get a better return with lower risk, or you will have a higher risk but a much higher return. That's how options are. There are two benefits: you can either make a ton more money—like boatloads of more money—with higher risk, or you can follow what I'm doing, which I'm doing both. I have a portion of my portfolio in the riskier stuff, especially with my one-on-one clients. I have folks coming in, and they're like, "Henry, you know, I've done well in life. I have a few hundred, or even pushing seven figures. I want to aggressively grow this money. I want to get it from $400K to $800K. I want to take it from half a mil to 1 mil, or I want to scale my seven-figure portfolio."
So I am focusing on some of the more risky stuff because in this market, when you can make 10, 15, 20% a month, it really pays off. It pays off because it helps you retire years earlier. Can you imagine? You have a half a million dollar portfolio; you're probably thinking in your head, "I have to work for, you know, in my lawyer job or my nursing job or, you know, as an engineer for a lot longer. I have stock options or whatever in my company, but I'm going to have to work for another 10 years," right? I want freedom now. I want to travel now, or I want to, you know, be at home now and be a dad or be a mom now, right? And have time with my family instead of being at the office all day.
Well, if you can go from $500K to $1 mil in one year, that's going to really, really reduce the amount of time that you have to work to actually reach retirement. It's going to give you more options, and it's just a shortcut. Why not take a shortcut? Why not take a shortcut to building wealth?
So I would say that when I look at what's happening in our post-election cycle, I'm very bullish, and I've been bullish, and that's why my portfolio is, you know, let's actually take a little quick deep dive into my portfolio and then wrap up this video. That's why my portfolio is now at $4.1 million. We just hit $4 million like a couple—what is it, like two weeks ago? Now we're at $4.1 million, and that's going to continue to grow in this bull market.
So take advantage of this bull market. Saturday, I have a webinar for two hours where I'm going to show you some LEAP plays that are going to just absolutely light you on fire. So I'm really looking forward to that webinar. I've already invested a lot of time into building the materials for it. I'm super excited to jump on and show you guys how to make money, bicep over tricep. I know I said it three times in my video today; I'm just super pumped up.
I'm super pumped up. I got like 10 emails today: "Henry, thank you so much. I made this amount of money. It's the best time ever." So I just want to keep it coming. I want to capture as much profit as possible, and I want to teach you guys how to capture as much profit as possible. So yeah, go ahead, subscribe. I don't need anything. At the end of the day, the only thing that I actually need is for you guys to invest safe, have a good time, reach financial freedom, and build your wealth. That's all I care about. I'm happy if that happens. I don't personally need anything.
Okay, so enjoy your day, have a blessed day, and I'll see you guys in the next video. All right.