Hi Kasha,
Phew, thank god I didn't buy those National Bank puts yesterday, the stock was up about .75 today alongside the rest of the sector. Sorry, I forgot to bring home the Almanac again, I'll do it tomorrow. The reason I choose July, which I still think may be a good idea, is due to the following:
1. Aprils would be way too soon (only 2 days left)
2. I can't recall the other series for May or June, but July would allow the full election campaign to take place assuming it's called for either June 2nd or 9th as expected. If the Bloc Quebecoois returns as many members to Parliament as before, I think that many international investors will start to get gittery about the possiblity of yet another sovereignty referendum in Quebec. This would hurt National worse than the others IMO. On top of this, there's the impact that the Quebec factor may have on the dollar, hence interest rates which would impact the banks in Canada. Also, July provides a bit of a buffer beyond the June period so as to allow losses to be cut if need be. The premiums are fairly low as well. That being said, if the banks perform as well as they did today, calls could be the answer. I still feel bearish on the sector in the short term however.
3. Anything further out than July is too expensive and goes beyond my bearish outlook.
On the subject of the almanac again, it's interesting to note that thee was a 62% probability that the DJIA would end higher today. 135 point rise is pretty convincing in light of that likelihood. What happened to WFC today? I didn't expect to see it dip the way it did today. The long bond yield was down to about 7.08, so I was surprised to see the selloff all the way down to about $253 at one point. Was there news I'm not aware of?
A bient“t (talk to you soon)
Steve |
