The highly anticipated speech moved the 10-year yield lower to nearly 4.90% as another rate hike in 2023 seemingly has become less likely.
The option strategy that I will utilize is a credit spread but, better known as a risk reversal.
If an investor is long a stock, they could create a short risk reversal to hedge their position by buying a put option and selling a call option.
No cost...with a catch This risk reversal is being used as an aggressive bull trade.
While there is a lot of time before this option strategy expires, there is an opportunity to manage this spread as it either moves for or against me.
Persons:
Jerome Powell, dovishly, Powell, Powell's, Long
Organizations:
Nasdaq, Federal, Treasury
Locations:
U.S