Long Straddle with Cineplex
September 11, 2020
Trading Idea

Long Straddle with Cineplex

Before the corona crisis hit, Cineplex was scheduled to be taken over by UK-based Cineworld Group in a $1.65 billion transaction. Cineworld was going to pay $34 per Cineplex share. However, the closing of the Canadian economy due to the coronavirus crisis led Cineworld to claim that there had been a material adverse change...

180
0
Like
2 weeks ago
Bear Call Spread in the XIU Market
September 09, 2020
Bearish Outlook

Bear Call Spread in the XIU Market

The stock market has rallied a long way from the March lows. The iShares S&P/TSX Equity 60 ETF (symbol XIU) is up almost $8 from that scary day on March 23, 2020 when the market reached bottom. The rally has been steady, with few pullbacks. However, it is completely natural to expect that, eventually, there will be a...

210
0
1
2 weeks ago
Stock Repair Strategy Using Options
July 30, 2020
Bearish Outlook

Stock Repair Strategy Using Options

The coronavirus crisis seemed to come out of nowhere. It caught retail and professional investors off guard equally. Almost overnight many stocks fell by more than 25%, and although some have managed to recoup their losses over the past few months, many have not. What is an investor to do in such an environment? One could...

599
0
Like
2 months ago
Harvesting Premium By Shorting Out-of-the-money Calls
July 30, 2020
Bearish Outlook

Harvesting Premium By Shorting Out-of-the-money Calls

Have you ever been in the fortunate position of holding a stock that had rallied a long way, but you were concerned it had gone too far too fast, yet you did not want to sell your position? Or, have you ever thought that the market would go sideways for a while, and you did not expect your stocks to rally? Maybe you have seen...

640
0
2
2 months ago
A Twist on Risk Reversals
July 10, 2020
Bullish Outlook

A Twist on Risk Reversals

The past few months have been challenging for investors. During the first month of the coronavirus crisis, the stock market fell from record highs with unprecedented speed. Meanwhile, the subsequent rally has been just as befuddling to many. Canada’s most liquid stock index ETF, the XIU, plunged from $27 to $17 (a loss of...

727
0
1
3 months ago
Butterfly on Shopify
June 10, 2020
Concepts

Butterfly on Shopify

Recently the Royal Bank of Canada lost its title as our country’s most valuable company in terms of market capitalization. For two brief weeks, Shopify sat at the top of the heap.   Chart 1: Royal Bank vs. Shopify May 31, 2020 Source: Bloomberg   SHOP’s run has been a sight to behold.   Chart 2: Shopify...

1019
0
1
4 months ago
Put-Writing Strategies in the Canadian Market
April 13, 2020
Bullish Outlook

Put-Writing Strategies in the Canadian Market

The coronavirus crisis has caused massive sell-offs in global equity markets throughout the world.  Canada has not been immune, and our benchmark large-cap S&P TSX 60 Index has lost over 36% from its February high.   CHART 1 – S&P/TSX60 Source: Bloomberg   A move of this magnitude from new highs to a...

1112
0
3
6 months ago
Shares in Uranium Participation Corp are trading at a discount
February 20, 2020
Bullish Outlook

Shares in Uranium Participation Corp are trading at a discount

Uranium Participation Corporation (Symbol U on the TSX exchange) is a company that invests in uranium. Uranium presents an attractive investment opportunity at this time. The commodity itself is currently trading at below the cost of production for most miners, a situation that cannot continue indefinitely. Eventually companies...

1633
0
1
7 months ago
Currency Options University — Part 7
February 18, 2020
Concepts

Currency Options University — Part 7

Currency Hedging for US Dollar Investors For the past decade, Canadian investors of US dollar-based assets have had it good. No, they have had it great. Not only have American financial assets been the best performing assets in the major markets, but over that same period the value of the Canadian dollar has fallen...

823
0
1
7 months ago
Currency Options University — Part 6
February 04, 2020
Concepts

Currency Options University — Part 6

Currency Hedging for Exporters In the previous post we examined the role that USX currency options can play in hedging a company’s import costs. In this instalment of Currency Options University, we will explore using Montréal Exchange USX currency options to mitigate the risk that Canadian exporters face when selling goods...

677
0
Like
8 months ago
Scroll Up