I suggested it was time to rotate away from frothy growth stocks that were pumped by the AI narrative recently, and buy into value stocks. I've discussed the bull case for India, Crude Oil, etc. at length already, and the signal from Ten Year Yields pointing for much higher rates, which together with deglobalization and various other bearish and inflationary fundamental cues swayed me in this direction.
We now have a nice signal in Exxon, which by itself is trending up in monthly scale and has ample upside (I got some long term OTM call options going). I added long exposure as a pair trade vs Amazon today.
You have roughly 20% downside risk to make close to 100% in the ratio now.
Which is a very attractive return.
Additionally, track the VTV vs VUG ratio, although the mega cap value ETF is a bit riskier than energy itself, it will likely follow this trend as well. (Or more simply put, SPY vs QQQ)
Many ways to express the same idea, which revolves around the trend in rates.
Best of luck!
Ivan Labrie.
We now have a nice signal in Exxon, which by itself is trending up in monthly scale and has ample upside (I got some long term OTM call options going). I added long exposure as a pair trade vs Amazon today.
You have roughly 20% downside risk to make close to 100% in the ratio now.
Which is a very attractive return.
Additionally, track the VTV vs VUG ratio, although the mega cap value ETF is a bit riskier than energy itself, it will likely follow this trend as well. (Or more simply put, SPY vs QQQ)
Many ways to express the same idea, which revolves around the trend in rates.
Best of luck!
Ivan Labrie.