Teen clothing retailer American Eagle Outfitters (AEO) dropped nearly 18% after hours Monday, after lowering guidance. Out of curiosity, I checked the cost of hedging AEO during market hours on Monday, and it turns out AEO longs could have gotten paid to hedge before the earnings miss. (more…)
Slope of Hope Blog Posts
Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.
How Two Microsoft Hedges Reacted To Friday’s Drop
How Two Microsoft Hedges Reacted To Friday’s Drop
Tim raised an interesting question in a post on Friday (“Does Microsoft Matter“). As Tim noted, apparently its earnings miss and plummeting share price didn’t matter much to the broader market. But it did, of course, matter to Microsoft longs. Last month, when Microsoft hit a new high, I posted two ways for those longs to hedge against greater-than-19% drops over the next several months (“Two Ways Of Locking In Microsoft Gains“). In this post, we’ll look at how those two hedges reacted to the stock’s drop on Friday. (more…)
BlackandblueBerry
In a recent post (“The Night Is Dark And Full Of Terrors“) we looked at how a couple of hedges could have saved ABX longs from bigger losses last week. BlackBerry (BBRY), which tanked nearly 28% Friday after a revenue miss, offers another example. One difference here is that BlackBerry investors could have gotten paid to hedge a few months ago. I bet many wish they had. (more…)
The Night Is Dark And Full Of Terrors
The Night Is Dark And Full Of Terrors
That cheery catch phrase from the Red Witch in Game of Thrones came to mind when reading Tim’s post about the hammering GDX took on Tuesday (“The Gold-Plated Falling Knife“). On Wednesday, GDX’s biggest holding, Barrick Gold (ABX) got hammered, falling more than 8%. In this post, we’ll take a look at how a couple of hedges on ABX from early May reacted to ABX’s drop as of Wednesday’s close. (more…)
When It’s Cheaper To Hedge Junk Bonds Than Treasuries
Down Elevator For Bonds?
In a post on Tuesday (“Bonds are Prone to Much Lower Prices”), Tim predicted that the iShares Barclays 20+ Year Treasury Bond ETF (TLT) could fall to around $100 per share by the end of June. On Twitter on Friday, investor and newsletter publisher Bob Brinker offered a similar warning regarding the junk bond ETFs SPDR Barclays High Yield Bond Fund (JNK) and iShares iBoxx $ High Yield Corporate Bond Fund (HYG), both of which closed Friday near their lows for the day: (more…)
