Options Trading: Bearish Call On FXI

Need to re-balance my portfolio which is currently has a beta-weighted delta of +2. Looking at some negative delta position to re-balance.

Technically, FXI is looking bearish at this juncture.

All indicators suggesting a short term bearishness for FXI

I may put up a short term bearish call spread with a DTE that does not go pass the US election (4 Nov). I believe that the US election will have significant impact on FXI – if Biden wins, China may do well (FXI will rise). if Trump wins, FXI may drop further. If you have an expiry that is > 4 Nov, you may subject yourself to possible spike in volatility (nearing election dates) which will have negative impacts on option sellers.

Possible trade – may be looking at 30 Oct trade, sell a call at $43 (80% OTM), buying a call at $45.

Disclaimer: This is not an investment advice or endorsement. Please refer to the general disclaimer of this blog.

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