Trade Alert: Another Bet Against A Bank
Plus a an exit.
Binyamin Mellish/Pexels.
Note: Unlocking this post, as the bottom just dropped out of First Republic Bank (FRC).
Two More Trades
I got these filled with limit orders placed before the market open, and it looks like you may get better prices on both of these now:
I exited our earnings call spread on Taylor Morrison Home Corporation ( TMHC 0.00%↑ ) for a net credit of $1.70, a gain of about 14%. It looks like their was a delayed positive reaction to yesterday’s earnings report.
Trade Alert: Another Bet On A Homebuilder
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Binyamin Mellish/Pexels. Still More Home Buyers Than Sellers At the end of last month, we placed a bet on a homebuilder based in part on its chart and fundamentals, as well as on the supply and demand characteristics of the housing market: You might think that, given the rise in mortgage rates over the last year, there would be more supply than demand, but it turns out that’s not the case. As [Altos Research founder Mark] Simonsen says in the video, supply is pretty tight, as fewer homeowners are selling now than in the past.
I bought the $3 strike, July 21st expiration puts on First Republic Bank ( FRC 0.00%↑ ) for $1.36. This is basically a bet on the bank going out of business or being acquired for peanuts in the near future. I looked at using a put spread here, but the risk/reward looked better with straight puts in this case.
Exited the other half of my FRC (now FRCB) puts at $2.70 for a gain of 99%.
Exited half of my FRC (now FRCB) puts at $2.70 today for a gain of 99%.