Back into This Core Technology Holding

Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world.

This week’s Alpha Algorithm recommendation revisits one of the world’s most prominent technology companies, Microsoft Corporation (MSFT).

Recall that you’ve already booked two sets of double-digit-percentage gains in Microsoft in 2017, including a 10.12% gain on June 8 and a 15.58% gain on Nov. 16. Today’s recommendation is an attempt to seize a third straight profit.

Despite hitting its stop two weeks ago, Microsoft remains the third favorite holding among all of the Alpha Algorithm strategies.

Founded in 1975 and based in Redmond, Washington, Microsoft Corporation develops, licenses and supports software products, services and devices worldwide. The company licenses the Windows operating system and related software, as well as Microsoft Office for consumers. It also provides Xbox gaming and entertainment consoles, Lumia phones and Skype.

Microsoft Corporation (MSFT) versus the S&P 500 year to date.

11 Top Investment Strategies Betting on Microsoft Corporation (MSFT)

1. Momentum Factor

The stock is one of the top 120 large- and mid-cap U.S. stocks exhibiting relatively higher price momentum, as measured by a specific factor which historically has driven a significant part of companies’ risk and return.

2. Large-Cap Growth

The stock is among the top 50 large-capitalization U.S. growth stocks generated through a rigorous 10-factor fundamental screening process.

3. Fundamental Strength

The company is a top U.S. stock based on fundamentals measured by book value, cash flow, sales and dividends.

4. Value Tilt

Selected using a multi-factor modeling approach, the company is a value stock designed to enhance portfolio risk/return characteristics.

5. Goldman Sachs’ Active Beta

The stock is selected according to four factors — value, quality, momentum and low volatility. These, in turn, are based on criteria including book value, sales and cash flow scaled by share price, profit/assets or return on equity (ROE), risk-adjusted returns and daily standard deviation of returns.

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6. Large-Cap Momentum

The stock is part of a major hedge fund’s systematic strategy that invests in large- and mid-cap U.S. companies with positive momentum and that rank in the top third of total return over the prior 12 months, excluding the last month.

7. High-Quality Stock

The stock exhibits positive fundamentals, including high return on equity, stable year-over-year earnings growth and low financial leverage.

8. Morningstar’s Moat

This stock is part of a strategy that tracks an equal-weighted index of 20 companies which Morningstar determines to have the highest fair value among firms with a sustainable competitive advantage or “moat.”

9. Billionaire Bet

The stock is one of 30 U.S. companies tracked in an equal-weighted index selected from the portfolios of 10 asset managers with a personal net worth of at least $1 billion.

10. Goldman Sachs Hedge Fund Index

The stock is part of the Goldman Sachs Hedge Industry Index, which tracks an equal-weighted index of the 50 most-frequently held U.S. companies selected from the portfolios of hedge funds.

11. Hedge Fund Alpha

Based on publicly available disclosures, successful hedge fund managers are investing in the stock.


Buy Microsoft Corporation (MSFT) at market today. Place your initial stop at a wide $77.90.


If you want to play the options, I recommend the MSFT February $82.50 calls (MSFT180216C00082500), which last traded at $3.69 and expire on Feb. 16.

Portfolio Update

You were stopped out of PayPal Holdings (PYPL) last night at $73.20 for a 35% gain.

Raise your stop in UnitedHealth Group Inc. (UNH) to $218.10 to lock in at least a 20% gain in the stock.

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Nicholas Vardy

Nicholas A. Vardy

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