Trade Alert: Two Structured Bets For 2026

Bullish options trades on one of our current top names that's been a previous winner for us, and on a small-cap photonics / compound semiconductor name from our Market Watchers list.

A Previous Winner Returns To Our Top Names

Our Top Names list continues to surface stocks tied to AI, infrastructure, and other secular themes our system has liked over the last couple of years. Our first trade today comes from Friday’s Top Names cohort: an insurance disrupter we already traded profitably once this year. After we exited that earlier combo for a gain, the stock pulled back and reset sentiment. Its current RSI and set-up score both suggest it’s not a falling knife here, but also not extended—exactly the kind of profile we prefer when stepping back into a former winner.

And A New Market Watchers Name

Our second trade comes from our Market Watchers list on X, where we track ideas from analysts and traders who have been early on a number of names that later showed up high in our rankings. In this case, it’s a small-cap photonics / compound semiconductor name tied to the indium phosphide substrate bottleneck for AI optical interconnects. Here too, the combination of RSI and set-up score tells the story: strong momentum and a technical rating of 10, but not yet in parabolic blow-off territory.

In both cases, options pricing is cooperative: we’re using defined-risk, multi-leg structures to get uncapped or wide upside while keeping our max loss per contract in the ~$700–$800 range.

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Today’s Top Names Trade

Insurance / AI underwriting theme

The stock is Lemonade (LMND 0.00%↑), and our trade is a combo expiring on March 20th, 2026, consisting of these four legs:

Buying the $75 strike call expiring on March 20th, 2026,

Selling the $85 strike call expiring on March 20th, 2026,

Selling the $65 strike put expiring on March 20th, 2026, and

Buying the $60 strike put expiring on March 20th, 2026,

For a max net debit of $2.10. The max gain on 1 contract is $790, the max loss is $710, and the break even is with LMND at $77.10. This trade filled at $1.76.

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Today’s Market Watchers Trade

Photonics / InP substrate bottleneck theme

The stock is AXT (AXTI 0.00%↑), and our trade is a combo consisting of these three legs:

Buying the $20 strike calls expiring on August 21st, 2026,

Selling the $15 strike puts expiring on February 20th, 2026, and

Buying the $10 strike puts expiring on February 20th, 2026,

For a max net debit of $2.65. The max gain on 1 contract is uncapped, the max loss is $765, and the break even is with AXTI at $14.34. This trade filled at $2.45.

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Exiting These Trades

My plan:

LMND – March combo

• Call spread (legs 1 & 2): Open a GTC limit order to sell the March $75–$85 call spread at $8.00, and lower that price, if necessary, as we approach expiration.

• Put spread (legs 3 & 4): Open a GTC limit order to buy back the March $60–$65 put spread at $0.20, and raise that price, if necessary, as we approach expiration.

AXTI – August/February combo

• Calls (leg 1): For now, I’m not opening a GTC limit order on the August $20 calls. After AXTI’s February earnings and once the February put spread has expired, I’ll post a price target for a GTC exit order on these calls in the comments here and via chat/email.

• Put spread (legs 2 & 3): Open a GTC limit order to buy back the February $10–$15 put spread at $0.20, and raise that price, if necessary, as we approach expiration.