With all the potential chaos around financial markets including the Russian financial meltdown, possible defaults, and other wild card scenarios we thought it would be prudent to buy PUTS on the S&P 500 so we executed a transaction for the March 30 $300 strikes for $0.30 per contract to buy some insurance and possibly reap some profit. We don’t expect this bet to pay off but feel more comfortable holding some level of insurance should the market meltdown between now and end of the month.
Key things that are happening over the next 30 days:
- Russia-Ukraine – Where do we go from here?
- Federal Reserve – Will they raise rates? If so, how much? What will be the market impact?
- Additional sanctions? Belarus? China? Others?
- Wild cards – Russia revenge: cyber attacks, supply chain disruptions, escalation, etc.
Should the market correct significantly, we will accumulate more stock in our defensive portfolio using the S&P PUTS profits and other cash we’ve been holding for prime opportunities.
Stay tuned and stay solvent…
[…] S&P closed down 2.95% today and while our PUTS are in the money now we are still holding on to them because we think there may be more blood over […]