Trump’s Second Term And China
According to ZeroHedge, Devan Kaloo, the Global Head of Equities at abrdn [Sic—the new name of Standard Life Aberdeen plc] said that Trump’s election this week “is likely to prompt aggressive China stimulus". That would make sense: Trump campaigned on using tariffs to reduce America’s trade deficit, and we have a larger trade deficit with China than any other country.
Aggressive China stimulus will be bullish for companies that serve China’s domestic market, and as it happens, one of those companies appeared in our top ten names last night.
Because this stock has a fairly low price, we can bet on it using call options, where our potential upside will be uncapped. Just this week, we exited a call option position for a 730% gain:
Calls on Travelzoo (TZOO -2.69%↓). Bought at $1 on 7/23/2024; sold (half) at $8.30 on 11/6/2024. Profit: 730%.
Maybe we’ll have similar luck with this trade. Let’s find out. I’ve also included a bonus, contrarian trade below.
Today’s Top Name Trade
The company is UP Fintech Holding Limited (TIGR 0.00%↑), and our trade is buying the $7 strike calls expiring on April 17th, for $1.70. The maximum upside on 2 contracts is unlimited, the maximum loss is $340, and the break even is with TIGR at $8.70. This trade filled at $1.50.
Today’s Bonus Contrarian Trade
Some of you may be tired of this name, given that we’re taking another L on it this week, but I have entered this longer-term trade on Super Micro Computer (SMCI 0.00%↑): a vertical spread expiring on August 15th, buying the $48 strike calls and selling the $49 strike calls for $0.15. The max gain on 20 contracts is $1,700, the max loss is $300, and the break even is with SMCI at $48.15. This trade filled at $0.15.
Exiting These Trades
If we get a big spike in TIGR post-earnings, I may sell half, and hold the other half until closer to expiration. For the SMCI trade, I will set a GTC limit order to exit at about $0.95, and lower that price, if necessary, as we get closer to expiration.