Option Professor Report- Chronic Caution versus Overvaluation-Who Wins? Read On
April 23 2021 Option Professor Opinions & Observations
The Option Professor is a graduate of Boston College and has decades of investment experience. He has instructed thousands of investors worldwide on the Uses & Risks of Investing.
Welcome Back!….This week we had a big sell off when Prez Biden said cap gains tax could go to 43%+ top levels (54% NYC)…which sent the bears roaring only to reverse course by Friday. We spoke of exploring hedging tactics (if you don’t know what that means…another good reason to SUBSCRIBE) at the highs around S&P 4200 last week. Still not a terrible thing to consider with the caveat that you know how to adjust your hedges if need be. There are a number of things that have cause CHRONIC CAUTION in many investors and institutions and they include virus spikes, higher taxes and nosebleed valuations. This has kept more money out then ordinarily would occur with these earnings and economic numbers hitting the roof. So here’s OUR TAKE….the companies have adjusted their structures to reduce expenses back to those a decade ago…..many companies have top line revenues starting to come in gang busters as we reopen….if you takes expected revenues and match them to OPERATING LEVERAGE you have a scenario where the shock factor may come in the way valuations are actually reasonable and may very well expand in financials material industrials energy and value/cyclicals. We share where & how to set yourself up for this to SUBSCRIBERS of our newsletter. We have all over the Europe opening by Labor day and EM by EOY plus a belief that if we get vaccination up to 60%-70% herd immunity kicks in and we’re home free. We also SHARE how to participate in these areas. The next 2-4 weeks could be very exciting and if the VIX stays contained to 12-20….a 5%-10% rally by summer not off the table. We have ideas to share on positioning for the USA. Europe and Emerging Markets & Tangible Assets. Subscribe Today!
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Stock Market
Briefly; the sectors we are focused on in Value Cyclicals Materials Industrial Health Care Financial & Energy are still the places to be as longer term Growth could very well be challenged by higher interest rates and an INFLATION SHOCK. In the weekly newsletter we SHARE with subscribers ways to position in these and others so we believe we ADD VALUE.
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Bond Market
We told everybody Bonds would rally coming out of the Q1 debacle as yields rose to discount HUGE economic number and Inflation BUT the market is starting to look through to the other side and see a reversion the mean on GDP & Inflation plus positioning was so short it had the bears scurrying to cover…not unlike when the Dollar tanked. We don’t believe this rally will stick so get the newsletter on how we position for INCOME & DIVIDENDS in our opinion & view.
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US Dollar/International Markets
We told you last week that the Dollar was skating on thin ice as the 50-200 Day MA’s were inverted to the downside and that te market last Friday closed UNDER both numbers…this week more of the same. OUR TAKE…investors are looking past the noise of COVID in Europe and starting to discount improving numbers in the months ahead. The Euro & GBP both have not had the printing press on as much as the USA and our trade deficit assures us our money is going overseas. China & EM have corrected and it looks like we may see a nice turn plus Europe has much better valuations than we do so the value hawks may be ready to ADD to international exposure..where is the puck going?
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Crude Oil Natural Gas
Crude Oil had a correction and then rebounded only to lose some ground this week We were bullish OVER a year ago during the fire sale and SUBSCRIBERS benefited from that information. Still a believer longer term as P/E money rig counts and investment in general suggests tighter supplies colliding with increased demand….We told you about Natural Gas bottoming at 2.50 & LNG at 70 so far so good…We SHARE our IDEAS with Subscribers so Join Up Today!
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Gold Silver Platinum Copper BitCoin COIN
We told you the lows of $1675 Gold $24 Silver & $1000 Platinum may be the lows for the rest of the year. We expect an inflation shock by Q3 or Q4 and if the Fed really sticks to no hikes…that’s a metals bull dream. We told you to fade Gold & Silver when it went parabolic but after the correction we have changed out tune….Platinum potential dark horse. Copper demand is off the hook (EV Solar Infrastructure Housing China) as the BEST conductor of electricity. Our views on BitCoin remains that on 30-50% drops you take a bite with risk capital and COIN pulling back nicely. Ethereum is now interesting and we will be outlining why in our newsletter in coming weeks…Don’t Miss It! SUBSCRIBERS get our FOCUS LIST on how to position in the markets and updates on our views…..a Great Value!
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Soybeans Sugar Coffee
There are bottlenecks in supply chains in many commodities (lumber ect) and there are weather factors that can come into play…we have told you about these and these markets/ETF’s have been moving to the upside…Subscribe Today!
REMEMBER There is a substantial risk of loss in short term trading and option trading and it is not right for everyone. Consult your brokerage firm/broker/advisor to determine your own suitability. Past performance is not necessarily indicative of future results. Use Risk Capital Only Opinions & Observations are for Informational purposes only.
