In November, CNBC Options Action's Mike Khouw placed a bearish bet on Invesco DB US Dollar Index Bullish Fund UUP. He bought the March $25 puts for 45 cents, and they are now worth 90 cents. He thinks it is time to close the position and bet on a bounce in UUP.
Khouw is bullish because of rising rates and an improving economy, but also because other governments are also expanding their balance sheets. He believes their currencies are going to experience the same types of pressure the U.S. dollar has experienced.
To make a bullish bet on UUP, Khouw wants to buy the March $24 calls for 50 cents. The trade breaks even at $24.50 or around 1% above the closing price on Friday.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.