Well, what can you say after a couple of days like that…except yowza. Fed rate cut and a new President in office. We’re also saying thank you because we were set up for success. We did the work, we came in prepared, and we killed it. The market was prepared for a Trump win, but perhaps not prepared for the breadth of his dominance. But for options volatility (the VIX), it was more about getting past the event. The not-knowing was the tough part for investors and once we had a clear winner, the floodgates opened for markets. But, while broader strength was yuuuge… right out of the gate there was a Zeitgeigst-changing shift in themes and sectors.Big cap tech mostly remained subdued on Wednesday while sectors like financials roared into the prospect of dis-regulation.
The Bitcoin complex soared with a Team Trump that will be very supportive of cryptocurrency in the years to come. And…knowing what’s good for them, leaders in Big Cap Tech, from Zuck to Bezos to Pichai, all came out to kiss the ring with sweet messages of well-wishing to President-Elect Trump. And then they TOO rallied yesterday – META a case in point – sneak peak: our high-conviction put sale from earlier in the week has captured 60% of premium in only a week. 2.8% on risk in 5 trading days? Not too shabby.
Readers, what you need to take away from this is…. This is a new world for equities. Under Trump’s tax cuts and spending plans this may become a debt-be-damned free for all. Until it stops, but that’s a worry for later. As I mentioned on Mark’s show – the market might male cause it can only focus on one thing at a time. And right now that’s chasing performance into year end. The pain point could still be to the upside. Corporate buybacks are massive in November, especially in big tech. Volatility targeting and CTA flows will be very positive the more we see volatility come down. A 10-year yield of 4.5% worries me, but the tailwinds are numerous.
This coming week will pale in comparison to what we just experienced from a news standpoint. And with big events out of the way sectors and themes will continue to jockey for position underneath the index hood. I’m looking for sea-change type plays to make. For example healthcare under RFK’s guidance, innovation under Elon, crypto, financials and more. I believe there is gold to uncover as we figure this out.
Our trades are doing great once again. As mentioned we are sitting on great gains in META. Our TSLA upside structure made bank on the Trump/Elon slumber party Tuesday night. Our upside call spread captured 85% on risk in a couple of weeks while some short puts captured 75% of premium received. COIN position cleaned up as we pieced out out very large call spread into that 30% move in the stock. We sold some early but actually closed most of it with the stock up $56 - we paid $1.50 and sold the balance at 39.10. That is NOT a typo.
We sold some more covered calls in PANW to pocket 5.5% on risk for the next 46 days of work. We sold some covered calls against HOOD, way too early but a win is a win. We will look to roll up this cash-machine play on any small pullback.
Our AMZN play has been huge and I’m holding on. I’ve been shouting from the rooftops since 185 and it hit 210 yesterday, my first target. I may roll it up.
Our NVDA cash-secured puts are up big but I held post-DOW inclusion and the 125 level is pretty safe into this melt-up.
Our ULTA put credit spread is about to make full value – 10% on risk in under 20 days – but let’s not count chickens just yet.
Good times but let’s not become complacent. I continue to look for collaring opportunities into significant strength. Also, as I mentioned on Oct 22, the upside cheap skew would probably normalize on a strong move up, and that's exactly what happened. Let's see how to play it this week but I have a couple of good ideas....
May the income (and sugar rush from leftover candy) be with you.
Well, what can you say after a couple of days like that…except yowza. Fed rate cut and a new President in office. We’re also saying thank you because we were set up for success. We did the work, we came in prepared, and we killed it. The market was prepared for a Trump win, but perhaps not prepared for the breadth of his dominance. But for options volatility (the VIX), it was more about getting past the event. The not-knowing was the tough part for investors and once we had a clear winner, the floodgates opened for markets. But, while broader strength was yuuuge… right out of the gate there was a Zeitgeist-changing shift in themes and sectors. Big cap tech mostly remained subdued on Wednesday while sectors like financials roared into the prospect of dis-regulation.
The Bitcoin complex soared with a Team Trump that will be very supportive of cryptocurrency in the years to come. And…knowing what’s good for them, leaders in Big Cap Tech, from Zuck to Bezos to Pichai, all came out to kiss the ring with sweet messages of well-wishing to President-Elect Trump. And then they TOO rallied yesterday – META a case in point – sneak peak: our high-conviction put sale from earlier in the week has captured 60% of premium in only a week. 2.8% on risk in 5 trading days? Not too shabby.
Readers, what you need to take away from this is…. This is a new world for equities. Under Trump’s tax cuts and spending plans this may become a debt-be-damned free for all. Until it stops, but that’s a worry for later. As I mentioned on Mark’s show – the market might male cause it can only focus on one thing at a time. And right now that’s chasing performance into year end. The pain point could still be to the upside. Corporate buybacks are massive in November, especially in big tech. Volatility targeting and CTA flows will be very positive the more we see volatility come down. A 10-year yield of 4.5% worries me, but the tailwinds are numerous.
This coming week will pale in comparison to what we just experienced from a news standpoint. And with big events out of the way sectors and themes will continue to jockey for position underneath the index hood. I’m looking for sea-change type plays to make. For example healthcare under RFK’s guidance, innovation under Elon, crypto, financials and more. I believe there is gold to uncover as we figure this out.
Our trades are doing great once again. As mentioned we are sitting on great gains in META. Our TSLA upside structure made bank on the Trump/Elon slumber party Tuesday night. Our upside call spread captured 85% on risk in a couple of weeks while some short puts captured 75% of premium received. COIN position cleaned up as we pieced out out very large call spread into that 30% move in the stock. We sold some early but actually closed most of it with the stock up $56 - we paid $1.50 and sold the balance at 39.10. That is NOT a typo.
We sold some more covered calls in PANW to pocket 5.5% on risk for the next 46 days of work. We sold some covered calls against HOOD, way too early but a win is a win. We will look to roll up this cash-machine play on any small pullback.
Our AMZN play has been huge and I’m holding on. I’ve been shouting from the rooftops since 185 and it hit 210 yesterday, my first target. I may roll it up.
Our NVDA cash-secured puts are up big but I held post-DOW inclusion and the 125 level is pretty safe into this melt-up.
Our ULTA put credit spread is about to make full value – 10% on risk in under 20 days – but let’s not count chickens just yet.
Good times but let’s not become complacent. I continue to look for collaring opportunities into significant strength. Also, as I mentioned on Oct 22, the upside cheap skew would probably normalize on a strong move up, and that's exactly what happened. Let's see how to play it this week but I have a couple of good ideas....
May the income (and sugar rush from leftover candy) be with you.
Hans
If you want to trade like a pro (an actual pro, not the BS other "pros" are selling) let me know.
www.crushthepremium.com/training for various options to work with me.
Bespoke 1-on-1 mentoring also available for $5000 a month. Almost unlimited access to me, all programs, all trades. As good as it gets for people who want to take this seriously and have the means ($2M+). If you have $5 million+ this is a no-brainer - I'm sure you're leaving a couple hundred grand on the table every year. Reach out to Natasha directly: hans@cashflowinsiders.com
Comentários