How to use the POWR Options approach of combining fundamental, technical and implied volatility analysis with a recent RIO trade as an example.
One of the screens we use in the POWR Options trade selection process involves comparing recent performance to help identify relative underperformance in Strong Buy (A – Rated) stocks.
The expectation is that this relative underperformance will be short-lived and these A – Rated stocks will be relative outperformers over the coming weeks. Bullish calls are purchased on these temporarily discounted Strong Buy stocks to profit from the anticipated outperformance.
Technical and implied volatility analysis is employed as well in the decision-making process.
A quick walk through a recent
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