At the intersection of travel, China, and the internet is Shanghai-based $TCOM — owner and operator of Trip.com, Skyscanner, Qunar, TrainPal, MakeMyTrip and other websites for hotel reservations, transportation tickets, corporate travel, and other travel services internationally. Other areas of business are insurance products, tours and packages, travel data collection and analysis for companies, travel reporting, online advertising and financing services.
Positive indicators: China re-opening after COVID, Beijing attempting warmer relations with Washington, and revenge travel buoying both short- and long- term outlooks for the industry.
The weekly chart for TCOM shows mainly bullish with a bit of indecision. Yahoo Finance confirms a positive outlook, with the majority of analysts saying it's a buy, with a few “strong buys” and a few “holds.”
This hedged options strategy can make up to 12% (21% annualized) while allowing TCOM room to fall 35% to below $18.81 through next June before losing any capital. If the stock rallies, will be able to exit the trade earlier and most likely collect higher annualized return.
Buy 1 $28 Call,
Sell 1 $32 Call,
Sell 2 $19.00 Puts,
All expiring 6/16/23
Capital Required: $3763
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