Betting on an Emerging Rally

Featuring Michael Purves

Michael Purves, chief global strategist and head of derivatives strategy at Weeden & Co., says now is the time to invest in emerging market fund EEM. He explains how he’s using options to bet on the popular ETF in this interview with Justine Underhill. Filmed on May 21, 2018.

Published on
25 May, 2018
Topic
Derivatives, Emerging markets, Trading
Duration
12 minutes
Asset class
Equities
Rating
21

Comments

  • WH

    W H.

    29 5 2018 02:11

    1       0

    The causality seems to be going the other way, meaning EM tech is driving and FANG is following. But some great reference points in terms of USD desensitivity.

  • JL

    Jordan L.

    28 5 2018 00:32

    0       0

    Purvees is a fantastic trader. I heard him recently on Adam Johnson's podcast. I hope to see him as a regular on Real Vision. Brilliant guy. I'd like a section on "how to follow" whether it's a Twitter handle or otherwise.

  • fT

    forecast T.

    27 5 2018 20:52

    0       0

    I dont understand any of this. All I know, some prices people stop paying but still buy calls. Some prices people overreact and buy puts. You sell to those people you may earn a return.

  • MC

    Michael C.

    27 5 2018 14:22

    4       0

    As of this weekend these options are down over 50% trading at .45 bid, .48 ask so this has caused some pain for his clients that ok the trade for sure. Strong $ and the bloodbath in Itialian debt might be partial reasons. Nevertheless a much better trade would have been and still is to sell some put spreads by selling the 45’s and buying the 42’s for net credit of .39 cents. 45 level has held back in Feb and in Dec 2017 so if his call is correct you can be benefit with limited risk of using a spread. He didn’t want to spread the calls but this way even if no movement occurs the next 7-8 weeks you collect on the trade.

  • CH

    Colin H.

    27 5 2018 14:18

    9       0

    Music is a bit loud

  • CC

    Chris C.

    27 5 2018 06:58

    1       0

    I'm bearish long term (true) emerging markets but my humble opinion Michael is spot on here! Tencent, Samsung and Baba are NOT "emerging market" type companies. I'm looking at shorts on emerging markets but I'm not shorting $EEM ETF.

  • RO

    Robert O.

    27 5 2018 03:37

    3       0

    If he likes EEM because of the asian tech stocks why not just by BABA on a pull back to 180 and sell when it nears 200 again. The way the stock has been trading you might be able to pick up a 10% gain in 1 to 2 months.

  • AP

    Andy P.

    26 5 2018 18:58

    3       0

    Great content. Please turn down the music.

  • CL

    Chewy L.

    25 5 2018 22:26

    3       1

    To each his own but just write off the premium if one puts this on. I personally hate going long short dated options unless there is an asymmetric R/R like 10:1 and even then I usually just piss away the premiu

  • MT

    Mike T.

    25 5 2018 18:48

    7       0

    irrespective of the directional analysis being right or wrong, expressing a bullish bias through the purchase of options is not optimal. In this instance the Probability of Profit with the Long July 47 Call is 34% and has negative Theta decay of nearly $1 a day.