Equities and Energy Options
The trades executed are for long MSFT, short AAPL in tech; long XOM and short CHK in energy. These trades are based on both sector sentiment and fundamentals. MSFT appears to be in an outperform trend while AAPL is poised to underperformed following poor sales data in China, slowing down of growth.
In energy, the price of oil is a big factor in any stock’s performance and with crude hitting a ceiling at $50, it will not be good for companies like CHK which are overwhelmed by debt and need oil prices to be higher in order to maintain any kind of leverage. XOM on the other hand is in an outperform trend which looks to continue as it nears a deal with Russia to deliver gas to China and as the company continues to invest along these lines, giving it an outlet should oil prices drop again. However, will the global economy looking so sluggish right now and no sector appearing to be safe (and should the UK vote to leave the EU, equities across the board may plunge) a cautious position should be taken first and built up in the coming weeks should the Brexit referendum not pass.
Thus a cautious stake in equities (both long and short positions) and a cautious stake in energy (both long and short positions) will be wisest, with 60% of funds remaining in cash, should positions turn against us and require quick action to effect a swing trade. Even buying and holding with equities at these prices (expensive) or shorting with equities at these prices (makes more sense but with markets manipulated by central banks — whether in China, Europe or the U.S., being a bear can be a good way to get crushed), caution right now is the word.
Equities Hypothesis
In the computer tech sector, there are Apple (AAPL) and Microsoft (MSFT). Apple has outperformed since its stock split last year and has recently made all time highs prior to a down trend setting in. This down trend is the result of the market pricing in a number of negatives that appear to be impacting Apple’s future growth. China sales have begun to shrink just as they have globally and the company itself seems to have hit peak tech development, with no new creative outlets being probed. The sense is that following the death of Steve Jobs, inertia may have continued to propel the company forward, but now the company has peaked.
Not to mention that Apple has taken on new debt to finance dividend increases in order to make the stock more attractive to investors (Cherney). However, any portfolio that has been holding AAPL since 2015 has surely been adversely affected by the stock’s significant pullback. I believe this trend is going to continue as AAPL continues to suffer from a slowdown in growth with no significant development in the pipeline to keep it foremost of the computer tech sector.
Against Microsoft, which has recently acquired LinkedIn and gotten into the marijuana seed-to-sale software business, AAPL looks ready to underperform. MSFT on the other hand may outperform as a result of its acquisition of the social media giant and its partnership with Kind, a marijuana tracking software company (Popper). Whether this will allow MSFT to benefit from the marijuana boom remains to be seen but it certainly could not hurt. On technicals alone, the stock appears to be consolidating nicely and barring any major global economic catastrophe such as a Brexit vote on the upcoming referendum in the UK, MSFT may outperform in the coming weeks and months.
Equities Number of Contracts and Data Screen Grabs
For AAPL, selling the Jun17 90 calls with strike price of $12 — number of contracts sold = 50 for price of $59, 750. This will leave sufficient funds available in case of margin call should the trade turn against us and sufficient funds available should more trades need to be executed to build on the portfolio. For MSFT, buying the For MSFT, buying the Jun17 50 calls with a strike price of 4.70 — number of contracts 200 for a total of $94,000.
Energy Hypothesis
Chesapeake (CHK) has underperformed as of late and while it may begin to see a reversal as it sells assets to make ends meet while the energy sector as a whole is hit hard by global macro data indicating rough times ahead and oil hitting lows prior to its recent bounce, the stock is still in serious downtrend. It is unclear whether CHK will be able to weather the storm even if oil stays above $40, and should WTI break and stay above $50 it is unclear whether CHK would move from underperform to outperform as a result of lackluster fundamentals. Analysts are bearish, with The Street calling for underperformance and a trend reversal in this company may not be in the cards any time soon (Gomez)
With an a global economy over-laden with debt and credibility issues plaguing central banks like the BOJ, the ECB and the Fed (talk of negative rates and helicopter money drops do not help — neither do promises of raising rates being walked back every time the latest round of poor economic data suggests that the economy is not in as fine a state as the Fed would like to see), energy stocks could be hit hard, especially if oil collapses again due to over-supply and dwindling demand. With Iran now pumping again and no real oil freeze on the horizon (and with the State Department no doubt still looking to cripple Russia’s economy by keeping oil prices low) energy stocks like CHK bear a certain amount of risk.
Exxon (XOM) on the other hand has risen with oil prices adding $45 billion to its market cap in recent weeks, and as it looks to secure a deal with Russia to export gas to China, the stock could pop further (Ausick). If XOM can strike a strategic deal with Russia, it will look to continue its uptrend and outperform in the coming weeks and months (Zacks).
Energy Number of Contracts and Screen Grabs
For CHK selling the Jan17 4.50 calls — number of contracts 300 for total price of $34,500.
For XOM buying the Jun17 92.50 calls — number of contracts 200 for total price of $103,000.
Works Cited
Ausick, Paul. “Exxon Adds $45 Billion to Market Cap.” 24/7 Wall St., 20 June 2016.
Web. 21 June 2016.
Cherney, Mike. “Apple to issue $10 billion to $12 billion of bonds to finance share buybacks, dividends.” Wall Street Journal, 16 Feb 2016. Web. 21 June 2016.
Gomez, Amanda. “Here’s Why Chesapeake Energy (CHK) Stock is Falling Today.”
The Street, 13 May 2016. Web. 21 June 2016.
Popper, Nathaniel. “The first big company to say it’s serving the legal marijuana trade?
Microsoft. Wall Street Journal, 16 June 2016. Web. 21 June 2016.
Zacks. “ExxonMobil’s Russian Project May Get Nod to Export to China.”
Finance.Yahoo.Com, 20 June 2016. Web. 21 June 2016.
Get Professional Assignment Help Cheaply
Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?
Whichever your reason is, it is valid! You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.
Why Choose Our Academic Writing Service?
- Plagiarism free papers
- Timely delivery
- Any deadline
- Skilled, Experienced Native English Writers
- Subject-relevant academic writer
- Adherence to paper instructions
- Ability to tackle bulk assignments
- Reasonable prices
- 24/7 Customer Support
- Get superb grades consistently
Online Academic Help With Different Subjects
Literature
Students barely have time to read. We got you! Have your literature essay or book review written without having the hassle of reading the book. You can get your literature paper custom-written for you by our literature specialists.
Finance
Do you struggle with finance? No need to torture yourself if finance is not your cup of tea. You can order your finance paper from our academic writing service and get 100% original work from competent finance experts.
Computer science
Computer science is a tough subject. Fortunately, our computer science experts are up to the match. No need to stress and have sleepless nights. Our academic writers will tackle all your computer science assignments and deliver them on time. Let us handle all your python, java, ruby, JavaScript, php , C+ assignments!
Psychology
While psychology may be an interesting subject, you may lack sufficient time to handle your assignments. Don’t despair; by using our academic writing service, you can be assured of perfect grades. Moreover, your grades will be consistent.
Engineering
Engineering is quite a demanding subject. Students face a lot of pressure and barely have enough time to do what they love to do. Our academic writing service got you covered! Our engineering specialists follow the paper instructions and ensure timely delivery of the paper.
Nursing
In the nursing course, you may have difficulties with literature reviews, annotated bibliographies, critical essays, and other assignments. Our nursing assignment writers will offer you professional nursing paper help at low prices.
Sociology
Truth be told, sociology papers can be quite exhausting. Our academic writing service relieves you of fatigue, pressure, and stress. You can relax and have peace of mind as our academic writers handle your sociology assignment.
Business
We take pride in having some of the best business writers in the industry. Our business writers have a lot of experience in the field. They are reliable, and you can be assured of a high-grade paper. They are able to handle business papers of any subject, length, deadline, and difficulty!
Statistics
We boast of having some of the most experienced statistics experts in the industry. Our statistics experts have diverse skills, expertise, and knowledge to handle any kind of assignment. They have access to all kinds of software to get your assignment done.
Law
Writing a law essay may prove to be an insurmountable obstacle, especially when you need to know the peculiarities of the legislative framework. Take advantage of our top-notch law specialists and get superb grades and 100% satisfaction.
What discipline/subjects do you deal in?
We have highlighted some of the most popular subjects we handle above. Those are just a tip of the iceberg. We deal in all academic disciplines since our writers are as diverse. They have been drawn from across all disciplines, and orders are assigned to those writers believed to be the best in the field. In a nutshell, there is no task we cannot handle; all you need to do is place your order with us. As long as your instructions are clear, just trust we shall deliver irrespective of the discipline.
Are your writers competent enough to handle my paper?
Our essay writers are graduates with bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college degree. All our academic writers have a minimum of two years of academic writing. We have a stringent recruitment process to ensure that we get only the most competent essay writers in the industry. We also ensure that the writers are handsomely compensated for their value. The majority of our writers are native English speakers. As such, the fluency of language and grammar is impeccable.
What if I don’t like the paper?
There is a very low likelihood that you won’t like the paper.
Reasons being:
- When assigning your order, we match the paper’s discipline with the writer’s field/specialization. Since all our writers are graduates, we match the paper’s subject with the field the writer studied. For instance, if it’s a nursing paper, only a nursing graduate and writer will handle it. Furthermore, all our writers have academic writing experience and top-notch research skills.
- We have a quality assurance that reviews the paper before it gets to you. As such, we ensure that you get a paper that meets the required standard and will most definitely make the grade.
In the event that you don’t like your paper:
- The writer will revise the paper up to your pleasing. You have unlimited revisions. You simply need to highlight what specifically you don’t like about the paper, and the writer will make the amendments. The paper will be revised until you are satisfied. Revisions are free of charge
- We will have a different writer write the paper from scratch.
- Last resort, if the above does not work, we will refund your money.
Will the professor find out I didn’t write the paper myself?
Not at all. All papers are written from scratch. There is no way your tutor or instructor will realize that you did not write the paper yourself. In fact, we recommend using our assignment help services for consistent results.
What if the paper is plagiarized?
We check all papers for plagiarism before we submit them. We use powerful plagiarism checking software such as SafeAssign, LopesWrite, and Turnitin. We also upload the plagiarism report so that you can review it. We understand that plagiarism is academic suicide. We would not take the risk of submitting plagiarized work and jeopardize your academic journey. Furthermore, we do not sell or use prewritten papers, and each paper is written from scratch.
When will I get my paper?
You determine when you get the paper by setting the deadline when placing the order. All papers are delivered within the deadline. We are well aware that we operate in a time-sensitive industry. As such, we have laid out strategies to ensure that the client receives the paper on time and they never miss the deadline. We understand that papers that are submitted late have some points deducted. We do not want you to miss any points due to late submission. We work on beating deadlines by huge margins in order to ensure that you have ample time to review the paper before you submit it.
Will anyone find out that I used your services?
We have a privacy and confidentiality policy that guides our work. We NEVER share any customer information with third parties. Noone will ever know that you used our assignment help services. It’s only between you and us. We are bound by our policies to protect the customer’s identity and information. All your information, such as your names, phone number, email, order information, and so on, are protected. We have robust security systems that ensure that your data is protected. Hacking our systems is close to impossible, and it has never happened.
How our Assignment Help Service Works
1. Place an order
You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.
2. Pay for the order
Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.
3. Track the progress
You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.
4. Download the paper
The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.
PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY AND GET A PERFECT SCORE!!!
