Panic Overdone? | VIX 3rd Highest Spike Ever | How the Strategies Held Up | Short Volatility Trades
Release Date: 08/09/2024
Tariffs | Market Fragility | Mortgage Rate Spread to Treasuries | Analysts Estimates Are Pretty Accurate
Broken Pie Chart
Derek Moore previews Palantir, Amazon, and Google earnings implied volatility expectations based on the option market. Plus, how currency movements may or may not mute new tariffs. Later, Derek answers a listener question on why mortgage rates (and bonds) have a spread between their rate and the 10 Year Treasury yield. Plus, digging into new data that shows analysts producing earnings estimates on the S&P 500 Index are pretty accurate as it turns out. Finally, what is market fragility and are we in a fragility period right now? What is market fragility? Analyst estimates vs actuals...
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Downside Protection is for Suckers? | Big Earnings Week | Percent of Time in Recessions | Bacon Egg & Cheese Inflation Index | Implied Volatility & Earnings
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Derek Moore previews Apple, Tesla, and Microsoft earnings by looking at the implied moves around earning by the options market. Plus, Bloomberg comes out with a new inflation gauge called The Bacon Egg & Cheese Sandwich index. Later, Derek talks about a new study which shows the percentage of time in recessions by decades. Oh, and reacting to a headline “hedging is for suckers” and why it’s wrong. Zero Hedge article headline “Downside Protection is for Suckers” reaction Percent of time in recessions Bacon Egg & Cheese Inflation Index from Bloomberg Implied volatility...
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Bitcoin Can’t Be This Easy? | S&P 500 Concentration Doesn’t Matter | Company Additions to S&P Performance | Implied Volatility Options Netflix Pre-Earnings
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Derek Moore is joined by guest co-host Mike Puck to talk markets including how people seem to think making money in Bitcoin is too easy and what that means. Plus, why the S&P 500 Index concentration may not be as big of a deal when looking at how the index changes. Comparing the top 10 market weighted stocks in 1997 to today. Later they discuss value vs growth performance, the dollar index, interest rates, and look at the implied volatility of Netflix options before earnings. Finally, they talk about how what seems obvious to all the CNBC talking head guests may not be the case. ...
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It Matters When It Matters | Employment Too Good? | Interest Rate Problem? | Dollar Problem? | Earnings Still Good? | AI The 6th Great Innovation?
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Derek Moore is joined by guest co-host Spencer Wright to discuss the surge in bond yields, the surge in the US Dollar Index, and whether those two things might cause some near-term pain for equity markets. Plus, discussing whether AI Artificial Intelligence is a true next technological revolution and what it means for earnings. Then they talk semiconductors as the picks and shovels of AI and do some technical analysis reviewing the patterns in the S&P 500 Index, the Nasdaq 100, Semiconductors and bond yields. Oh, and there was the unemployment report that markets didn’t like in the...
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Market Pullbacks Data | Yields Keep Rising? | Forward EPS vs PE Ratio | MicroStrategy Implied Volatility | 1 Fed Cut in 2025?
Broken Pie Chart
Derek Moore talks about the level of implied volatility in MicroStrategy and its performance relative to bitcoin. Plus, looking at how much future fed cut expectations have fallen for 2025. Later, Derek explains what drives returns looking at the forward p/e ratio vs forward analyst eps estimates for the S&P 500 Index, 2/10s US Treasury spread widening as yields rise, are 10 Year Treasury yields about to break out, and quietly crude oil has been rising. What would that mean for CPI and inflation navigation for the Fed? Bitcoin vs MicroStrategy Calculating implied 1 standard...
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2025 Predictions | Un-Inverted Curve | China Deflation Tariff Solution?| Bitcoin Quantum Problem?
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Derek Moore and Jay Pestrichelli round out the year with some 2025 predictions on markets, rates, bonds, oil, bitcoin, the dollar, GDP, inflation, and gold. Plus, does Bitcoin have a Quantum Computing problem? What’s going on with deflation in China and is it the answer to potential tariffs? And news flash, the inverted yield curve is no more as the 10-year treasury yield rises above the 3-month treasury yield. All this and more! 2025 Predictions China Deflation including 10-year Chinese Government Bond yields falling China currency valuation, bond yields, and deflation a recipe to...
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VIX Spikes as Market Has Tantrum | Fed Hawkish Cut| Inflation Not Getting to 2% | Dollar Index Breaks Out
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Derek Moore and Jay Pestrichelli react to the Fed meeting where people are calling it a hawkish cut and a reset of future expectations of where interest rates end up. Plus, the Dot Plots say long run PCE Inflation will only go to 3% not 2%. Later looking at the Trade Weighted Dollar Index breakout and if it will become a problem for earnings growth in 2025. Of course, the big news last week was the spike in the VIX as the market had a temper tantrum. Finally, they go into earnings expectation, price to forward sales ratio, real retail sales, and more and even a wacky (or not) Amazon...
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S&P 500 7000 By Year End 2025? | Multiples vs Earnings Growth | Inflation Still Too High? | Probabilities Calculated Using Options | Fair Share on Taxes?
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Derek Moore and Jay Pestrichelli gather once again to discuss whether inflation is too high for the Fed to aggressively cut rates more. Then, they talk about the probability of the S&P 500 closing or getting to 7000 by year end 2025. Plus, is inflation still too high looking at Core CPI and CPI Supercore for the fed to cut rates as much as projected. Later, they go into some myths on the US debt and foreign ownership of treasuries, US Dollar Index against some resistance levels, what does paying your fair share in taxes mean, and more. How probabilities are calculated based on...
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Hawk Tuah Crypto Scam? | United Healthcare CEO Single Stock Risk| Unemployment Breakdown | +29% S&P Years More Common| MicroStrategy vs. Bitcoin
Broken Pie Chart
Derek Moore and Jay Pestrichelli cover markets including the news on the CEO of United Healthcare, the Hawk Tuah meme coin alleged scam, unpacking the latest unemployment report, how markets go up 29% or more in a year more often than you’d think, and how the rotation of voting members of the FOMC might be hawkish in 2025. Plus, checking in on the ratio of returns of MicroStrategy vs. Bitcoin. Plus, looking at the 53-month drawdown in the US Aggregate Bond Index and corresponding ETF. Hawk Tuah crypto meme coin alleged scam, pump and dump, rug pull etc (alleged) What is a pump...
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Markets Getting Overvalued? | MicroStrategy Convertible Bonds| 1st Year Presidential Cycle | 2025 Year End S&P 500 Targets Lazy?| MicroStrategy Option Volatility
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Derek Moore and Jay Pestrichelli join up once again to talk about whether the forward PE ratio is getting overextended. Then, they discuss where we are in the 4-year Presidential market cycle, years with the most all-time highs, the US Dollar and interest rates, and PCE inflation numbers. Later, they get into the dynamics of the MicroStrategy convertible bonds and how they resemble options. Finally, they talk through the option dynamics on MicroStrategy include what the implied volatility is, what it is implying for a move over the next year, and what the breakeven levels would be on a...
info_outlineDerek Moore and Jay Pestrichelli jumped on a special edition podcast to discuss whether the move in things like the VIX and VIX were warranted given the technical surroundings of the carry trade and where markets went. Looking back at previous VIX spikes and the high yield spread in times of crisis. Plus, discussing how some strategies held up and some insights into what went on. Finally, what a higher volatility regime would mean for strategies that sell options like covered calls or high probability credit spreads.
VIX 3rd highest spike in history going back to 1992
VVIX 4th highest spike ever
Comparing the VIX Index spike to the High Yield Spread
There was no VIX Index back in 1987 but estimates say it would have been highest ever
Are there currently structural problems showing in the US Economy?
Unemployment rate up due to increase in population and size of labor force
Explaining the VVIX Index
Warren Buffet comment about whether you should be invested in stocks
People don’t make good investment decisions when they panic
Market performance historically after major VIX spikes
Comparing the carry trade blowup to August 2015 drop due to the Chinese Yuan move
Mentioned in this Episode
Podcast Market Volatility | Yen Carry Trade Unwind Explained | High Yield Holds Up | Dissecting the Unemployment Rate Rise Causes
https://open.spotify.com/episode/4aBJMdpmanE3Anncxlzfqs?si=zflHqMZuS7OZ5cAL0ae0Sg
Derek Moore’s book Broken Pie Chart https://amzn.to/3S8ADNT
Jay Pestrichelli’s book Buy and Hedge https://amzn.to/3jQYgMt
Derek’s new book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag
Contact Derek [email protected]