With the Federal Reserve poised to potentially hike interest rates by 75 basis point in 9 days there is little place to hide but oil and gas stocks seem to be poised to go higher so we decided to execute a final trade before we pause for the next FOMC meeting on November 2.
Yesterday, we gave you our list of Canadian oil & gas stocks we liked and we decided to buy OVV and ERF. We sold the November out-of-money strikes for both and hope to reap 4% and 6% return respectively on this trade.
As usual, we nibbled on the market with this trade and we hope that we are called on the stock which would mean a forced sale to cover our options but that would be fine given we’ve already collected the premium.
We’ll let you know how this trade works out after November 18th so stay tuned and stay solvent…