Us Stock Intelligence Agent | Eli, Linear
This article summarizes the latest large order changes in the option market for you.
By monitoring these market data, investors can use this often neglected information and formulate investment strategies.
Around the vaccine, the general election, and the macro environment, Bank of America Corporation released the most awesome questionnaire survey of fund managers in 2020. Through the survey, it is found that the managers of investment institutions have reduced most of their cash positions, showing high expectations for GDP in 2021, abandoning the bond market into the equity market, and increasing the exposure to small market capitalization and emerging market concepts.
Although Bank of America Corporation concluded that in the mode of close to full firepower, although the Q4 plate rotation will continue, the vaccine data in the next few weeks or even months may lead to large-scale volatility selling on good / news shipments. The bulls of these institutions are mainly reflected in the following aspects:
Capital side
The level of institutional cash positions has fallen from 4.4 per cent to 4.1 per cent, and the current level is even lower than 4.2 per cent before the outbreak (January). This level of funds combined with Bank of America Corporation's internal bull and bear indicators (4.2) is little left to trigger a "sell" signal.
Vaccine
Even while the COVID-19 epidemic is still likely to continue to expand the tail risk of the market, agency managers continue to price the vaccine and now expect it to be available in January 2021 (previously expected in February 2021).
Macroscopic surface
Expectations of global economic growth and high corporate profits are currently at their highest levels in 20 years. 66% of institutional investors believe that the economy has completely transitioned from recession to the initial stage of economic stabilization, while 47% of corporate executives are still planning to make financial statements.
Risk preference
A steeper yield curve is expected, with equity positions magnified to 46% (the highest level since January 2018).
Rotation trend bulls
The trend of plate rotation has been mentioned many times. In November, institutional investors increased the investment of emerging markets, small market capitalization, value category and banks, while reducing the investment allocation of risk aversion attributes such as cash, bonds, daily consumption and so on. However, the performance of the target of energy crude oil in the traditional periodic plate lags behind in the Q4 rising cycle.
2021
According to the survey, when asked about the outlook for 2021 investment, the trend of investment varieties of institutional investors is very detailed. These include emerging markets, the S & P 500 Index, oil and so on. At the same time, they still have a great interest in technology in 2021 after the technology boom in November.
Changes in ETF options in the market (November 17)
Changes in individual stock options in various sectors (November 17)
Science and technology stock
Industrial stock
Cyclical consumer stock
Financial stocks
Communications Unit
Medical and Health Unit
Energy stocks
Real estate stock
Building Materials Unit
Defensive consumer stock
Public utilities unit
The option tool is flexible and easy to use, and it is considered to be the most perfect trading tool in the financial market so far. small funds can quickly accumulate wealth through accurate judgment using non-linear leverage. large funds can achieve stable returns through the comprehensive application of multiple strategies across bull-bear and shock markets. But we also need to see the buyer's risk of options (ordinary investors are careful to be sellers of options, with limited returns and unlimited losses):
1. Nonlinear huge leverage will suffer huge losses if it is faced with going in the wrong direction.
2. Volatility drops, and the other side may lose money.
3. The state of mind is easy to be out of balance with big fluctuations.
4. Time is the enemy of option buyer.
5. Stock thinking is serious. Stock thinking is just want to do long, will not short, fall more want to bottom, trap, ignore and so on rebound, and even some people add positions to lower costs, the result is deeper and deeper to zero. If you don't change your mind, it's dangerous to make options.