27% profits every 20 days?
This is what Nic Chahine averages with his options 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.
Deutsche Bank's Parag Thatte commented in a research report Friday that investors are positioning their portfolios in several ways to hedge the too-close-to call U.S. election race, which for the time being is skewed toward a Clinton victory.
According to Thatte's research, U.S. equity funds saw large outflows last week of $3.5 billion, even as flows to other regions held up. European funds also saw a nine-month run of outflows come to a halt, while emerging markets and Japan-focused equity funds saw no flows.
Meanwhile, money market funds saw large inflows of $57 billion in the past two weeks, which marks a reversal of the large outflows seen over the past three months. High-yield fixed income saw a $4.4 billion outflow and inflows to high-grade and emerging markets slowed to $0.2 billion and $0.8 billion, respectively.
Inflation protected bond funds also saw one of the largest weekly inflows on record of $1 billion.
Post-Election Rally
Thatte believes that while the market fears a change in the political status-quo, new policies in Washington that can create volatility are "highly unlikely" in the near term.
"Against a back-drop of an unfolding V-shaped recovery in both earnings and GDP growth, we see elevated options positions likely to be unwound, driving a rally post-election, similar to the post-Brexit one," the analyst wrote. "We note that the post-election rally in previous close elections occurred regardless of the candidate/party that won."
Finally, Thatte suggested that close presidential elections have seen a risk premium that kept equities flat to down in the four months heading into the vote. Once all is said and done, the market rallied by 5 percent by year-end as the uncertainty premium dissipated.
At last check in the pre-market on Election Day, the SPDR S&P 500 ETF Trust (NYSE: SPY) was down 0.17 percent at $212.78.
27% profits every 20 days?
This is what Nic Chahine averages with his options 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.
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