Rotation into lagging cheap-skew stocks like Tesla
The guest argued that capital is likely to rotate into lagging names like Tesla where call options have recently transitioned from cheap put skew to call skew, rather than continuing to chase overextended hardware names.
The argument
With implied volatility trending lower and the broader tech chase cooling ahead of NVIDIA earnings, the guest noted that cheap, lagging names with improving option skews present a more attractive tactical setup than extended names like AMD.
The thesis, stress-tested
✓ What validates it
- ✓Tesla call options continue to bid up relative to puts
- ✓TSLA outperforms AMD over the weekly horizon leading into earnings
▸ Risks discussed
- ▸Lagging names may continue to underperform due to weak underlying company fundamentals
- ▸Broader market volatility compression could suppress option price appreciation
Hear it yourself
"billion times in my career is, like, looking at this huge thing going on in the short term being, like, wow. That's a huge problem. The market's, like, forget about that. Like, earnings over the next ten years are gonna be massive. Yeah. So, you know, I think that's part of what's going on. Yeah. And it's kinda funny because it was, I guess, two months ago now that we were talking about software stocks. Right? And and Satrina had put out this big piece that made, I mean, global headlines. It was one of those"
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