Trading Strategy Opportunities for right now. There continue to be profitable trades available for you in the market place – provided your Trading Strategy is broad enough. As we have seen equities succumb to profit taking in the past week – hardly surprising given the run up in markets over the past 9 months – there continue to be opportunities available right now.
Your opportunity focused Trading Strategy
As our focus has panned out to seek better quality. Not simply share based opportunities for our clients. The current market pullback has delivered! Given our ability to trade US based instruments. As well as those traded on the local ASX boards, once again, opportunity has presented itself.
How many of these trades are you open to taking?
Since we rolled out our US recommendations, an increasing number of clients are participating in the trade ideas we have been putting forward. The advantages being the broader range of opportunity, ability to identify and trade special situations and lower fees! All from the same account you may also be trading your Aussie stock and options from.
Here are a trio that we are running right now
Calendar Spread on the VIX
Calendar Spread on the VIX – looking to generate income from holding long dates VIX call options, which were trading at relatively cheap levels, and then selling the shorter dated calls over them. Given the pick up in volatility in the past week, this is trading is pretty much exactly where we want it to be.
Calendar Spread on the TBT Exchange Traded Fund (ETF)
Calendar Spread on the TBT Exchange Traded Fund. Previously we traded this as a covered call. This time, as a calendar spread, it is offering a lower amount of capital required to take the trade. TBT is an ultra short US Treasury ETF – as US Treasury prices fall, the value of the ETF moves higher. Given that inflationary pressure is virtually non-existent in the US, and that interest rates are unlikely to be rising any time soon, the fundamentals support this trade well.
Covered Call on the SCO (short crude oil) Exchange Traded Fund (ETF)
Covered Call on the SCO (short crude oil) Exchange Traded Fund. Should crude oil hold its current level, we continue to generate income, from selling calls over the position. Should crude pull back – perhaps from softening Chinese growth, or generally slower economic condition, not to mention the broad shifts in US production, then the underlying ETF will go up in value, enabling us to also lock in profit on the bought position, as well as income from the sold portion.
The above trades should demonstrate just how a flexible trading strategy can dramatically improve your ability to profit from market moves. Traditional equity investors, right now are looking hard at the screens, wondering whether this is it, time to sell, or buy more, or just wait another day, and see what happens. In the meantime, the more active trader and investor, who is opportunity and strategy focused, should be sitting in at least the trades above, or perhaps others that are similar.
How to execute your Trading Plan
The business of trading is actually a relatively simple one. Executing your trading plan, perfectly, each and every trade. Sounds easy – and it should be. The work comes in building your plan, and that should encompass a wide range of trading opportunities, both here and on the international stage. Having a more global perspective certainly opens the door for opportunity.
The famous quote “Think Global, Act Local” certainly applies in this instance, but irrespective of global or local, the key word here is act. This is no time to be on the sidelines – and neither have the past nine months – opportunity is there, and as always, only rewards Action Takers. Click here to join one of our powerful education workshops and see what opportunities are available to you.