Last week my partner, trader extraordinaire Bryan Bottarelli, knocked it out of the park on, get this… trades that had NOTHING to do with artificial intelligence!

Two highlights included Dollar General (DG) and Advance Auto Parts (AAP), which brought home gains of 189.7% and 293%, respectively, overnight. Those are not typos. And both trades happened in less than 24 hours.

As you might guess, War Room members were pretty happy with the results.

Check out a few of their comments below…

• “Yes. Congrats! IN [AAP puts] with $5,100, out with $34,500 [overnight]!” – Chainsaw
• “Holy cow! Just signed in, sold my AAP put for a profit of $2,606 [overnight]! Thank you, Bryan! That’s the kind of thing I was hoping to see! Whoopee! Sold the put at $34.35. (In at $8.30).” – Adezutter
• “I closed the 2 shares/contracts [of DG] I opened at $5.11 for $30.10. I only played the PUT side. Made $4,998 on 2 contracts [overnight]. Thanks BB!” – Ednchina

This is why we’re so proud of The War Room. It’s a community where like-minded traders can come together and help each other navigate the markets.

Let’s dig a little deeper into the strategy Bryan used to trade those stocks…

How Options Strangles Work

Bryan used what’s known as an “options strangle.”

An options strangle is an investment strategy that involves buying a call option and a put option with the same expiration date but different strike prices.

The purpose of a strangle is to profit from a significant price movement in the underlying asset, regardless of whether the price goes up or down.

By purchasing a call option (an option to buy) and a put option (an option to sell), the investor is essentially betting on a large price swing in either direction. If the price moves significantly, the value of one of the options will increase, while the value of the other will decrease.

The goal is to make more money from the increasing value of one option than you lose from the decreasing value of the other.

Options strangles are often used when investors expect high volatility or uncertainty in the market but are unsure which direction the price of an asset will move.

This strategy provides the opportunity to profit from a significant move while limiting potential losses if the price remains relatively stable.

When prices move, you can make a ton of money if you correctly predict the direction. But what if you don’t know the direction? That’s when a strangle can save the day and mint you money.

YOUR ACTION PLAN

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MONDAY MARKET MINUTE

• Another Strong AI Play. One of the biggest holdings within the Global X Robotics and Artificial Intelligence ETF (BOTZ) is Intuitive Surgical (ISRG), which has been involved in AI technology for years. Its revolutionary da Vinci Surgical System enables complex surgeries using a minimally invasive approach – all with help from AI technology. Maybe all those investors who got fired up about Nvidia (NVDA) this past week will start moving into ISRG as well. Tracking.
• What Does June Hold for Traders? We avoided a market downturn last month despite the dreaded “sell in May and go away” warning… so now it’s on to dealing with the next historical rhyme, the “June swoon.” Based on what we saw last Friday, we’re doing just fine. Last week, the S&P 500 posted its best week of the year, hitting its highest point since August. And the Nasdaq – which has basically carried this entire rally – posted its sixth consecutive winning week.
• Oil on the Rise. Prices ticked up this morning after Saudi Arabia said it would cut production by another 1 million barrels per day starting next month. These voluntary cuts were a result of an OPEC meeting. We’ll be ready for a potential move into energy as a result.
• Circor (CIR) Up Double Digits. The manufacturing company saw a 50% premarket rise after announcing that it has entered into a definitive agreement to be acquired by investment funds managed by KKR (KKR) in an all-cash transaction valued at approximately $1.6 billion.