A “Goldilocks” Landscape for Option Sellers?


Mar

16

2018

A “Goldilocks” Landscape for Option Sellers?

Click To Read Video Transcript

(Video Transcript)

Good afternoon. This is James Cordier of OptionSellers.com with a market update for March 16th. Well, in reading the Wall Street Journal this past week, and maybe some of you have read the same article that I was reading, it talked about the end of Goldilocks. They were referring to interest rates creeping up towards 3% on the 10 year. Basically, they’re forcing investors and money managers to consider some fixed income. Goldilocks, of course, was interest rates at basically 0. Their only real investment idea was to go along with the stock market. And, of course, US stocks and stocks abroad have done extremely well over the last several years.

And now, with the idea of fixed income becoming parts of certain portfolios, the stock market, while it still may climb in the coming year or two, will likely have to do it on its own accord – not just basically a free ride, which in case it probably has had in the last year or two. Going forward, commodity option buyers love uncertainty. In our thoughts going forward, we do have a Goldilocks environment going forward for us. A vibrant US economy, a vibrant Asian economy, and of course the European economies are doing extremely well just recently. Along with rising interest rates, certainly not a rapid pace of raises, but probably a quarter here and a quarter there, that is Goldilocks for what we do here at OptionSellers.com.

A lot of option buyers love uncertainty. We see certainty ahead on many fronts. We thank 2018 for some of that reason. It’s going to be quite good. We do have seasonal trades coming up in the next 30 to 60 days, one being soybeans. We love the idea of being short that market going forward. We are going to have an abundance of soybeans this fall, and we think using strength in that market over the next 4 to 8 weeks is going to be an excellent idea. We think that’s going to definitely help pad accounts in 2018.

Anyone wanting more information about OptionSellers.com, can visit our website. If you’re not already a client of ours and would like to become one, you can contact Rosemary at our headquarters in Tampa, FL about possibly becoming one. As always, it’s a pleasure chatting with you, and I look forward to doing so again in 2 weeks. Thank you.

  1. Thank you James.
    Max

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