Options Strategy for Walgreens: Diagonal Spread

Options Strategy for Walgreens: Diagonal Spread

Assessment

Interactive Video

Business

University

Hard

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The video discusses the stock performance of Avon Products and Walgreens. Avon is facing a downgrade due to currency risks, with options activity indicating a bearish outlook. Walgreens, on the other hand, is experiencing a bullish trend due to strong earnings and strategic deals. A trading strategy involving a diagonal spread is suggested for Walgreens. The video also provides a market overview, highlighting the decoupling of oil and S&P 500 movements, and warns of potential risks in the latter half of the year, emphasizing the importance of monitoring the VIX.

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5 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What was the primary reason for BMO's downgrade of Avon Products?

Management changes

High competition in the market

Currency risks related to Russia

Poor sales performance

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What does the large purchase of January 10 calls for Avon Products suggest?

An optimistic outlook

A bearish outlook

A bullish outlook

A neutral outlook

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Why is the speaker bullish on Walgreens' stock?

Due to a decrease in competition

Because of a merger announcement

Because of a solid earnings beat

Due to a new product launch

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the trading strategy suggested for Walgreens?

Buying and holding

A diagonal spread

Day trading

Short selling

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is a potential concern for the market in the back half of 2015?

Interest rate risk

Technological disruptions

Rising inflation

Decreasing oil prices