Are you guilty of buying trendy stocks at the absolute top only to see them crumble? It's a major reason behavioral finance remains an important subject for investors to study in their attempt to deliver better long-term returns. Marvell Technology (MRVL) Stock Might Offer a Quick Bounce Before Earnings Unusual Put Volume in Rare Earth Stock REalloys Could Be a Bullish Play on ALOY The Calm Before the Storm?
Low IV Stocks Worth Watching Get exclusive insights with the FREE Barchart Brief newsletter. Subscribe now for quick, incisive midday market analysis you won't find anywhere else. The markets continue to set records amidst a rocky economic picture for everyone but the 1%.
Yet, we all seem hell-bent on not missing out. My wife swears I'm 100% FOMO, especially when it comes to having fun. I can't stand the idea of missing out on a good time.
Strangely, despite my FOMO, I don't feel that when it comes to stocks. I've never had an addiction to momentum; I doubt I ever will. While looking at yesterday's unusual options activity for today's commentary, I got thinking about those who can't resist buying into a momentum stock that's up 200% in a year.
What can they do to lower the risk of buying at a potential top? Two words come to mind: Married Put. The options strategy involves purchasing underlying shares in a company you want to own and simultaneously buying one or more put options to provide downside protection.
While long-term stockholders often use the married put, it can also be used to protect against an unexpected decline in the future share price. Here are three examples from yesterday's unusual options activity where I believe a married put makes total sense. Denver-based Ovintiv (OVV) moved its HQ from Calgary in 2020.
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