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We've been talking a lot lately about how trading options can be a great part of an investment strategy – and for good reason! Their low prices compared to the stocks they control make them ideal for keeping risk down while still offering the potential for outsized percentage gains.
And now, with simple-to-use and commission-free platforms like Robinhood, getting started has never been easier. Today we're bringing you a Robinhood options trade to profit off of the economy's summer reopening.
The current market, rocked by the global pandemic, has created tremendous investment opportunity. Not only is there a chance to buy stocks selling for big discounts, but you can also profit from the dramatic rise in volatility. The VIX is more than double its 2019 average right now.
This uncertainty creates mispricing, especially as Wall Street tries to figure out what the pandemic and shutdowns mean for each company. In fact, most of the companies that announced their earnings already really could not offer much guidance for the next quarter themselves.
That's an opportunity for you. By doing some research, you can figure out which companies should thrive once the economy starts to open up again. Money Morning Quantitative Specialist Chris Johnson has already done a lot of thinking about that.
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While the pandemic and social distancing practices will continue to hinder some companies, especially in the travel sector, others can benefit almost right away. Chris' research shows a gradual reopening will boost one sector in particular more than any other.
And we can turn that into an options trade simple enough to do on Robinhood…