The financial markets can be intriguing, yet they present an unparalleled chance for strategic investment. It is imperative that one navigates the choppy waters with utmost precision to gain maximum advantage. Amid the recent market selloff, there are two great options plays that investors could consider, namely Apple Inc. (AAPL) and Microsoft Corporation (MSFT).
## Apple Inc. (AAPL)
Apple Inc., regarded as one of the tech titans, has not been exempt from the recent market beatdown. This scenario has presented a unique buy opportunity for investors during the selloff. As per the intrinsic value calculator, Apple’s stock is undervalued at the moment. Institutions, being the significant component of the company’s shareholders, are likely to take advantage of these lowered prices to build up their positions.
Before the market correction, Apple stock was seen steadily scaling up. Despite the selloff, the tech behemoth demonstrated strong resilience, thanks to its robust fundamentals, supreme brand reputation, and consistently innovative product portfolio. The company’s unveiling of the 5G iPhone 12 and their newfound focus on subscription-based services promise to hedge the stock amidst the uncertainties.
Therefore, purchasing options contracts with medium to long-term expiration, strike prices close to the current trading price may provide rewarding potential for investors willing to bet on Apple’s performance.
## Microsoft Corporation (MSFT)
Another tech giant, Microsoft Corporation, has also seen its share of the market correction. Despite this, Microsoft’s stock portrays a strong resistance level that seems rather persistent. In other words, it is maintaining a significant price level which it is not descending below, indicating investor confidence.
Owing to its strong performance record, Microsoft’s cloud platform Azure’s exponential growth, and shareholder-friendly policies, Microsoft remains a preferred portfolio candidate for many investors. Its consistent dividend hikes and massive share repurchase programs are indicative of its financial fortitude.
Furthermore, the intrinsic value calculator reveals that Microsoft’s shares are undervalued, presenting a ripe opportunity for investors looking to tap into its potential.
In this context, options contracts with strike prices close to current trading price but expiring in the long term may be a plausible play to investors believing in Microsoft’s future performance.
However, with the rising popularity and application of cloud technology, investors concentrating on this sector could consider out-of-money calls, betting the stock will climb higher than the strike price before the option expires.
## Risk Considerations
Despite the lucrative opportunities presented by Apple and Microsoft during the selloff, investors must be cognizant of the inherent risks associated with options trading. Extreme caution and deep understanding of the options contracts’ mechanisms must be employed before making any investment decisions.
To summarise, Apple Inc. and Microsoft Corporation manifest as compelling plays for investors equipped to handle the volatility of the markets and are looking for avenues to leverage during the market selloff. Both these companies display promising fundamentals and remarkable resilience against market downturns. Their undervalued state further adds to their attractiveness. No matter the market scenario, these two giants are always worthy of consideration for investors, highlighting their enduring appeal in the tech sector.