Good morning!
Remember last week we only bought the 2024 Russell spread SO WE COULD CASH OUT THE 2023 $20s – never forget why you are in a position…
If we consider that the Russell tends to move in 800-point major cycles, then 800, 1,600 and 2,400 are our major lines. There was no consolidation at 2,000 so really this is about a run from 1,600 to 2,400 and that 800-point run means 160-point pullbacks to 2,240 (weak retrace) and 2,080 (strong retrace) – so we expect a bit of a bounce around here/ If not, we'll be scrambling to get more aggressive on the TZA hedge as 2,000 won't be any support and then we're looking at the weak bounce of 1,760 and strong bounce at 1,920 as the next proper supports.
MSFT buying ATVI for $70Bn is amazing. That's about $90/share – back to the undeserved highs. Lots of gaming users is a good get for MSTF and ATVI does have a $3Bn/annual recurring revenue stream and, with MSFT trading at 35x – that's worth $105Bn to them. Of course, I think the 35x is too much but even at a reasonable 25x – this is a good get for MSFT.
That does NOT (Pharm) translate into RBLX, who LOSE $400M/yr being worth anything near their $45Bn price-tag at $80. No thanks.
SQQQ/Jij – It's a reverse split so the brokers should be reassigning the options. Yes I would roll when it's worth it but not if it isn't. Like the 2023 $25 calls are now $12/17, which is crazy wide but better than the 0.47 they were showing pre-market. Just make some really good offers that favor you and see if anything fills.
CRSP/Rn – $5.1Bn is probably a great deal for CRSP but, of course, they are still essentially pre-profit and pretty much pre-revenue too. This is the technology that will give us spider powers though – and who doesn't want those? They've got lots of cash ($2.5Bn), no debt and game-changing technology so worth a long-term toss and back on sale at $66.6 is definitely some sort of sign….
What is starting to excite investors at this point is that CRISPR Therapeutics has shown huge progress in the first diseases that it decided to target, which are β-thalassemia and Sickle Cell Anemia. CRISPR Therapeutics now has trial data for twenty-two patients consisting of fifteen β-thalassemia and seven Sickle Cell patients, that shows all of these patients were functionally cured after one treatment with CTX001. CRISPR Therapeutics is expected to launch CTX001 in 2023.
Funny, I thought we had VRTX, who are partners in CTX110 but we don't. That being the case, let's add CRSP to our Future is Now Portfolio:
- Sell 5 CRSP 2024 $60 put for $21 ($10,500)
- Buy 15 CRSP 2024 $60 calls for $30 ($45,000)
- Sell 15 CRSP 2024 $100 calls for $20 ($30,000)
That's net $4,500 on the $60,000 spread that's $12,000 in the money to start with $55,500 (1,233%) upside potential if they can get back over $100. I also like it as we have room to make money along the way – the April $90 calls are $3.20, for example and we could sell 5 (1/3) for $1,600 and make back 1/3 of what we laid out using 86 of our 731 days but there is no hurry – let's see if they pop and we can do better.
