By Lawrence G. McMillan
This week’s feature article is a bit longer than usual, but with volatility at such low levels, and so many traders and media talking about it, I wanted to describe how volatility hedged positions should be viewed. The articles covers the specifics from basic positions such as portfolio protection, through a new recommendation as a sort of stock market straddle buy (on page 5), and finally to the Volatility Capture Strategy that we use in our managed accounts.
The Follow-Up section (page 6) updates the status of some of our conditional recommendations that are dependent on volatility.
We continue to view the market as intermediate-term bullish (page 7), although overbought conditions may weigh on the market in the short term. On page 8 is an article discussing a subscriber question regarding collars on high-yielding stocks.
On page 9, there are volatility trading recommendations in FDX and Wheat. There are also speculative plays in Live Cattle and GMCR.
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