SPX 5000 - the everything bull next?
JPM's head of US market intelligence, Andrew Tyler, argues that we are setting up for an "everything rally" into year end. Imagine tech and value rallying together from here?
He writes:
"Large-cap Tech is seemingly more correlated with real yields; whereas, Value and Banks are more tied to the shape of the nominal curve. It is possible that he nominal curve steepens while real yields real neutral. In Mislav’s strategy note this weekend, his research shows that after the 2013 tapering Tech rallied alongside the Value sectors."
How do you play such a scenario?Given the most recent vol reset, we like using relatively cheap volatility for directional options plays. If this melts up, upside calls will kick in quickly.Use it for replacement strategies or pure speculation.
He writes:
"Large-cap Tech is seemingly more correlated with real yields; whereas, Value and Banks are more tied to the shape of the nominal curve. It is possible that he nominal curve steepens while real yields real neutral. In Mislav’s strategy note this weekend, his research shows that after the 2013 tapering Tech rallied alongside the Value sectors."
How do you play such a scenario?Given the most recent vol reset, we like using relatively cheap volatility for directional options plays. If this melts up, upside calls will kick in quickly.Use it for replacement strategies or pure speculation.