Smart Money Moves with Microsoft Stock

Microsoft's stock is currently trading at $491. 54, which is lower than its recent peak but higher than its recent low. This presents an opportunity for investors to make some smart moves. One such move is shorting cash-secured puts that expire in one month. This strategy can provide a good return and set a lower buy-in price. Microsoft's strong free cash flow and margins suggest that its stock could be worth $682. 55 per share. This makes it an attractive option for investors looking to make a profit. In a previous trade, investors received $7. 10 in premium for shorting puts that expired on December 5 at the $500. 00 strike price. This resulted in a 1. 42% one-month yield and a breakeven point of $492. 90. This trade can now be repeated. For example, the January 9, 2026, expiry period shows that the midpoint premium at the $475. 00 put option strike price is $5. 63. This strike price is $16. 54 below today's trading price, or 3. 36% out-of-the-money. This means that an investor who secures $47, 500 in cash with their brokerage firm can potentially buy-in at $475. 00 and receive $563 in income immediately. This results in a short-put yield of 1. 185% and a potential breakeven buy-in of $469. 37, which is 4. 5% below today's price. This provides good downside protection along with immediate income. Over the last two months, the investor would have received $12. 73 in income, resulting in a total yield of 2. 68% and a net breakeven of $462. 73, which is 5. 76% below today's price. As long as Microsoft stays roughly in this trading range, it makes sense to short these out-of-the-money puts. This strategy can provide a good income and set a lower potential buy-in point. The bottom line is that Microsoft stock still looks cheap, and shorting cash-secured puts in one-month expiry periods can provide at least a 1. 1% monthly income.