A market hedge for traders if you believe this May comeback is a head fake

[Pelican Press 0]

A market hedge for traders if you believe this May comeback is a head fake

This is the hidden content, please

• Sign In
• or
• Sign Up

, causing market participants to take profits and apply pressure to equity prices. The trade As I believe we will continue to trade in the 4800-5300 range on the S & P 500 , I want to establish a postion which seeks to capitalize in the event we do see an about face in equity prices. Selling a Risk Reversal in SPDR S & P 500 ETF Trust (SPY) : Sold $540 6/07/2024 call for $1.15 Bought the $500 6/07/2024 $500 put for $1.05 This was traded with underlying SPY trading roughly $522 This risk reversal collected $0.10 or $10 for every one lot This is important to understand that the upside $540 call is ******. In the event you have long exposure to the S & P 500, this short call will serve as a hedge to that long exposure. If this is simply a trade, that upside call will need to be managed. I remain optimistic on the equity market in 2024 but, I believe the CBOE Volatility Index at 12 reveals complacency short-term. DISCLOSURES: (Long SPY and this trade.) THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.

This is the hidden content, please

• Sign In
• or
• Sign Up

Breaking News: Markets,Markets,Personal finance,******* States,S&P 500 Index,SPDR S&P 500 ETF Trust,CBOE Volatility Index,business news
#market #hedge #traders #comeback #fake

This is the hidden content, please

• Sign In
• or
• Sign Up