GameStop Option Bets | S&P Too Top Heavy? | Nvidia Passes Apple | Upcoming Banking Problems from Mortgages?
06/09/24 • 45 min
Derek Moore and Jay Pestrichelli, CEO of ZEGA Financial look at some what seem like crazy options trades in GameStop. Plus, examining Nvidia passing Apple as the second largest stock in the S&P 500, and can it pass Microsoft for #1? They also talk about whether it’s a problem the top 4 stocks in the S&P 500 make up such a large percentage of the weighting and comparing it to the last time it was this high. Later they take some listener questions including whether the data shows cracks in the regional banks due to mortgage delinquencies, what happened in the unemployment report, and more.
Unemployment reaches 4%
Top 4 companies in the S&P 500 Index highest since the 1960’s
Comparing the contribution to returns S&P 500 Index top 496 vs the top 3 and Nvidia
Residential mortgage delinquencies and effect on regional banks
FDIC quarterly data on the health of banks
Nvidia passes Apple for #2 as its market cap exceeds Apples but will Microsoft be next?
1964 vs 2024 top 4 company weighting in the S&P 500 Index
Now the top 4 companies today are a lot more diverse business
GameStop options trading
Looking at the 128 calls open interest, volume and probabilities next 2 weekly expirations
Volatility in the GameStop option chain
Mentioned in this Episode
Mortgage Bankers Association data on residential mortgage delinquencies https://usreop.com/mba-chart-of-the-week-seriously-delinquent-rates-by-loan-type-conventional-fha-va-may-17-2024/
Delinquency rates on commercial real estate loans from FRED https://fred.stlouisfed.org/series/DRCRELEXFACBS
CNBC piece on potential cracks in the banking system https://www.cnbc.com/2024/03/19/where-cracks-in-the-banking-sector-may-appear-without-more-ma.html
Crazy VIX Bets Due to Election? | Market Reversal | Home Ownership Affordability Today | Shiller PE
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]
Derek Moore and Jay Pestrichelli, CEO of ZEGA Financial look at some what seem like crazy options trades in GameStop. Plus, examining Nvidia passing Apple as the second largest stock in the S&P 500, and can it pass Microsoft for #1? They also talk about whether it’s a problem the top 4 stocks in the S&P 500 make up such a large percentage of the weighting and comparing it to the last time it was this high. Later they take some listener questions including whether the data shows cracks in the regional banks due to mortgage delinquencies, what happened in the unemployment report, and more.
Unemployment reaches 4%
Top 4 companies in the S&P 500 Index highest since the 1960’s
Comparing the contribution to returns S&P 500 Index top 496 vs the top 3 and Nvidia
Residential mortgage delinquencies and effect on regional banks
FDIC quarterly data on the health of banks
Nvidia passes Apple for #2 as its market cap exceeds Apples but will Microsoft be next?
1964 vs 2024 top 4 company weighting in the S&P 500 Index
Now the top 4 companies today are a lot more diverse business
GameStop options trading
Looking at the 128 calls open interest, volume and probabilities next 2 weekly expirations
Volatility in the GameStop option chain
Mentioned in this Episode
Mortgage Bankers Association data on residential mortgage delinquencies https://usreop.com/mba-chart-of-the-week-seriously-delinquent-rates-by-loan-type-conventional-fha-va-may-17-2024/
Delinquency rates on commercial real estate loans from FRED https://fred.stlouisfed.org/series/DRCRELEXFACBS
CNBC piece on potential cracks in the banking system https://www.cnbc.com/2024/03/19/where-cracks-in-the-banking-sector-may-appear-without-more-ma.html
Crazy VIX Bets Due to Election? | Market Reversal | Home Ownership Affordability Today | Shiller PE
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]
Previous Episode
Crazy VIX Bets Due to Election? | Market Reversal | Home Ownership Affordability Today | Shiller PE
Derek Moore and Jay Pestrichelli, CEO of ZEGA Financial review some interesting VIX option trades around the election and around inauguration day in 2025 compared to the next few months options action. When young people say home ownership dreams are dead is that true? Surprising numbers to compare inflation adjusted costs. Plus, on Friday the market swung from down over 1% to up almost 1% as we continue to be in a buy the dip regime. Later discussing the evolving Fed rate cut expectations and why it shouldn’t be a surprise. Finally, they go bring up container shipping costs rising again and what that means for inflation, the Presidential election market cycle, history of interest rates, and more.
Looking at VIX trades far out of the money around election and inauguration day
Are retail investors making bets on a rise in volatility due to the election?
Why trading VIX options can be frustrating and may be misused by retail traders
Home ownership dreams dead for young people?
Comparing a monthly mortgage payment today on an inflation adjusted basis to historical
Home prices compared on an inflation adjusted basis
History of interest rates over 5000 years
Container shipping costs on the rise
Share buybacks at highest level over the last couple years and what that means for earnings
Friday’s huge market reversal going from down to up in the last hour
Fed rate cut expectations through the end of 2024 down from 7 cuts to 1 cut
4th year of the Presidential cycle and the S&P 500 Index
What Shiller Cape ratio means for returns over the next 10 years
Cape PE ration and Price to Free Cash Flow
Mentioned in this Episode
History of Interest Rates book by Sidney Homer and Richard Sylla https://amzn.to/3V3TNEJ
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]
Next Episode
Market Crash? | Fed Meeting Dot Plots | Inflation Break | Apple’s AI Breakout |
Derek Moore and Jay Pestrichelli, CEO of ZEGA Financial are back with a Fed meeting day edition where they break down the new end of year interest rate dot plots and Jay Powell’s press conference. Plus, they riff on Harry Dent’s latest prediction saying Nvidia is going down 98% and why the doom and gloom crowd are harmful to investors. Later discussing Apple’s breakout after their AI announcement at WWDC conference and the reaction to the CPI inflation print. All this and more!
Apple’s AI WWDC announcement reaction by the stock market
Apple vs Nvidia vs Microsoft for the title of largest market cap
Buy the Rumor Sell the News Buy the News on Apple
Post Fed Meeting announcement reaction
Fed newest Dot plots and what they say for the year end target for interest rates
The fed funds futures moves intraday
How to calculate the implied fed funds rate
Inflation print comes in light but year over year numbers still above Fed’s target
How the CPI Supercore is still running over 4.8% year over year
Harry Dent says markets are going to crash but has said the same thing over and over again
Why doom and gloom predictions are harmful for investors
Reviewing some past Harry Dent prognostication
Harry Dent says Nvidia may go down 98% while the Nasdaq will see a -92% crash
Battle for the largest market cap between Apple, Nvidia, and Microsoft gets interesting
Mentioned in this Episode
Harry Dent predicts Nasdaq to crash 92% https://www.livemint.com/market/stock-market-news/boy-this-is-over-economist-harry-dent-predicts-98-crash-in-nvidia-92-drop-in-nasdaq-heres-why-11718162529764.html
CBS News article “Harry Dent and the chamber of poor returns” https://www.cbsnews.com/news/harry-dent-and-the-chamber-of-poor-returns/
GameStop Option Bets | S&P Too Top Heavy? | Nvidia Passes Apple | Upcoming Banking Problems from Mortgages? https://podcasts.apple.com/us/podcast/gamestop-option-bets-s-p-too-top-heavy-nvidia-passes/id1432836154?i=1000658371572
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]
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