By Lawrence G. McMillan
The feature article is brief this time, but it is pertinent in that a potential buy signal has just set up in the Total put-call ratio – or has it? It doesn’t completely fit the parameters that we have laid out for such buy signals, but perhaps “close enough” is sufficient. The article discusses whether it is or not.
On pages 2-4, there is a article describing the VQTS ETN – a hedged vehicle designed by UBS to use volatility derivatives, accompanied with a long stock market position, to outperform $SPX. It is different than VQT, and the article points out how the two serve unique purposes, depending on what the investor wants to accomplish.
Our market opinion is on page 6. $SPX is trying to break out on the upside, and many of the indicators have turned bullish to accompany this move. However, unless the old highs can be exceeded, it doesn’t mean much.
On page 6, there is a discussion of the takeover triangle between MYL, TEVA, and PRGO. Also, there is an event-driven straddle buy in NFLX.
Other recommendations include a SWKS put sale (p.8), Live Catlle speculative trade, INTC trade, and STX trade (all on page 9), and a VXX/SPY put hedge (page 12).■
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