Tuesday, June 12, 2018

Trade ideas following Trump - Kim Summit

Long Risk Reversal on EWY

Buy 76 Call and Sell 73 Put

Expiration: 2018-10-19
Net Credit: $0.20

  • EWY trades at an NTM P/E of ~8.7x
  • Any positive news from the meeting between US President Donald Trump and Supreme Leader of North Korea Kim Jong-un could lead to a rally in South Korean equities
  • EWY is exhibiting a technical Wedge pattern (Due for a Breakout)
  • 55% of the price variation in EWY can be explained by the price variation in FXI over the past two years
  • EWY has a Beta of 0.67 and a correlation of 0.75 with FXI over the past two years.
  • South Korea’s macroeconomic trends remain strong with: 1Q2018 Final Sales to Domestic Purchasers growing ~4.87% and 1Q2018 Net Trade Balance % of GDP expanding to ~5%
  • South Korea’s Balance of Payments remains primarily exposed to Asia/ASEAN region

MCHI Call Spread Collar

Buy 72 Call and Sell 77 Call and Sell 68 Put

Expiration: 2018-08-17

Net Debit: $0.25

  • 200 Day Moving Average is $67.73
  • ETF is in Technical Uptrend


Submitted June 12, 2018 at 07:11AM by QuantalyticsResearch https://ift.tt/2l5tnlo

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