27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.
The SPDR S&P 500 ETF Trust (NYSE:SPY) bounced off its early Monday lows but still closed down 1.4%, while the Dow Jones Industrial Average dropped 725 points for its worst day of 2021.
The primary catalyst driving the market lower appears to be a rise in COVID-19 cases (specifically in regards to the Delta variant) and the potential for another wave of infections to derail the global economic recovery.
ENTER TO WIN $500 IN STOCK OR CRYPTO
Enter your email and you'll also get Benzinga's ultimate morning update AND a free $30 gift card and more!
Last week, the U.S. averaged 30,000 new COVID cases over a seven-day stretch, up sharply from the 11,000 cases it was averaging a month ago. At the same time, oil prices dropped after OPEC and its global allies agreed to start phasing out production cuts starting in August. The new plan calls for 5.8 million barrels per day of oil production to return completely by September 2022.
Related Link: Should Investors Be Worried About The Delta Strain Of COVID-19?
Cramer’s Take: CNBC's Jim Cramer said COVID-19 numbers and oil prices are a devastating one-two punch for stock prices.
“Market liked covid down and oil up..not getting what it wants,” Cramer tweeted.
FREE REPORT: How To Learn Options Trading Fast
In this special report, you will learn the four best strategies for trading options, how to stay safe as a complete beginner, a 411% trade case study, PLUS how to access two new potential winning options trades starting today.Claim Your Free Report Here.
However, Cramer urged long-term investors to look beyond the recent spike in COVID cases.
“I just think that where we are there’s just so much fear in the market, and I just think that the asymptomatic [COVID] is not as dangerous, the deaths are not going up that much. So I’m not buying that this is the end of the bull market,” Cramer said.
Keeping Perspective: Ryan Detrick, Chief Market Strategist for LPL Financial, said investors should remember to keep the market sell-off in perspective.
“Fears over peak economic data and a resurgence in COVID cases has the market on edge today. Of course, don't forget that the S&P 500 hasn't had a 5% correction since October, so you could say we are more than due for some turbulence,” Detrick said.
Peter Essele, Head of Investment Management for Commonwealth Financial Network, said the decline in 10-year U.S. Treasury yields to near their lowest levels of the year on Monday was indicative of the market’s collective flight to safety.
“Fear of stagflation will be a major concern for investors if a resurgence in COVID infections causes economies to slow while consumer prices continue an upward trajectory. The strong performance of inflation-linked bonds as of late may be an indication that those fears are setting in, with the bus already having left the station,” Essele said.
Benzinga’s Take: It certainly feels scary when the market drops 1.4% in a single day. But the current COVID-19 vaccines have been shown to be extremely effective against all variants of the virus, and the World Health Organization has said most vaccinated people who test positive for the delta strain of COVID are asymptomatic.
27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.