Positioning For US Election 2020

No matter who wins in the upcoming election, there will be a spike in volatility or VIX in the last few trading days prior to the US election on 3 Nov 2020.

Historically, VIX will peak on the 7th trading day prior to election. If US election is on 3 Nov 2020, the 7th day will be 26th October 2020.

I decided to position my option strategies as follows:

Create a credit put spread on VIX

Anticipate a support @ $21. Short a put @ $21, long a put @ $19.

Creating a debit put spread on TLT

Currently, TLT has an IVR of 14.5% and hence, the strategy for a debit spread. Hoping for a spike in IV as we are nearing US election date
The trend appears to be on a downtrend, hence a debit put spread. Long put @ $168, short put @ $166

Create a debit call spread on EEM

IV Rank of EEM is low at 13.4%, hence to consider a debit spread option strategy
Long a call $41.5, short a call $43.5 to create a debit call spread. $43.5 appears to be a good resistance zone.

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

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