FINANCIAL EDUCATIONFast-Food is Getting Cheaper - How to Trade These...

Fast-Food is Getting Cheaper – How to Trade These Stocks

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Last week, McDonald’s, the big fast-food chain, said they’d have a $5 meal deal for a short time to attract people who care about prices.

Now, Burger King, another big chain owned by Restaurant Brands, is doing the same thing. They’re bringing back their $5 meal deal, called ‘Your Way Meal,’ like they agreed with their stores in April.

Since the COVID pandemic, restaurants all over have had to raise their prices because stuff like food costs more, and it’s harder to get. But because prices keep going up, people, especially those with less money, don’t want to pay as much.

Many restaurants have noticed that people with lower incomes are spending less at restaurants and shops. Because of this, fast-food places, which usually do okay during ups and downs, aren’t doing as well. McDonald’s hasn’t been selling as much for four quarters in a row now. But Burger King is doing a bit better. In the first part of this year, their sales at stores that were open last year went up by 3.9%, which was better than what experts thought.

McDonald’s will have their $5 deal for only a month, but Burger King plans to have theirs for a few months. Their deal comes with a choice of three sandwiches, plus chicken nuggets, fries, and a drink.

They’re also trying out two other cheap deals that might come out later in 2024.

Other fast-food places are doing deals too. Last week, Wendy’s said they’d have a $3 breakfast deal with potatoes and a muffin with bacon, egg, and cheese or sausage, egg, and cheese.

While fast-food places might be losing customers, big stores like Walmart are selling more groceries.

Walmart’s money guy, John D. Rainey, said it’s about 4.3 times more expensive to eat out than to cook at home, which is making their business better.

How has inflation made you eat differently?

Trading Put Credit Spreads

Put credit spreads are a popular options trading strategy used by investors seeking to generate income and manage risk. While they may sound complex, with a bit of understanding and practice, they can become a valuable tool in your trading arsenal.

Put credit spreads involve two options contracts: selling a put option and simultaneously buying a put option with a lower strike price, both with the same expiration date. The goal is to profit from the belief that the underlying asset’s price will either rise or remain above the sold put option’s strike price by expiration.

How to Execute a Put Credit Spread:

Select an Underlying Asset: Begin by choosing a stock or ETF that you believe will remain stable or rise in price over the duration of the trade.

Choose Strike Prices and Expiration: Identify strike prices and expiration dates for your options contracts. Typically, you’ll sell a put option with a strike price below the current market price and buy a put option with an even lower strike price. Ensure both options have the same expiration date.

Sell the Put Option: Execute your trade by selling the put option with the higher strike price. This obligates you to potentially buy the underlying asset at that strike price if the option is exercised by the buyer.

Buy the Put Option: Simultaneously, purchase the put option with the lower strike price to limit your potential losses if the market moves against you.

Receive Premium: As the seller of the put credit spread, you’ll receive a premium upfront from the buyer of the spread, which is your maximum potential profit for the trade.

Here are some results from our members… (click the tweet to see the results)

Trading stock options changed my life.In May I will make $7,132.27 USD in booked and realized profits.But this is the crazy thing: 👇— Stephen (@StephenCFU_) May 28, 2024

At CFU, we trade Put Credit Spreads regularly to generate steady income streams from stocks all while staying hedged.

Come trade with us, learn how to trade options and make some money.

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See you inside our Discord!

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