This is unusual for me, and full disclosure, I am not personally trading this. I don't short on margin and the spreads on puts are a little too wide for my liking. So think of this as my musing on a market that I think is still overbought from last week.
I get why it has been running - yield is tantalizing in a struggling market, and monthly payouts even more so, I suspect. But I am firmly of the belief that we are headed for some pretty rough times in the economy, and retail real estate, triple net lease or not, is not where I'd want to be, personally. Their top 3 tenants are Dollar General, Walgreens, and Dollar Tree, who are all having their own struggles right now.
6 consecutive up days causing a retail-leveraged REIT to jump almost 10% when economic data is flashing recesssionary warning signals, along with pending inflationary impacts of tariffs does not help its case. So simply as a short term, overbought in a bad space call, I'm expecting
O to go lOwer soon.
I'll consider tactically adding to the short and closing when the price is lower than the average lot sales price. This might result in an individual lot ending with a loss, but an overall trade win. With shorts, I don't get hung up on that.
Feel free to disagree, and I could well be wrong. I had the same thesis about 2 months ago on AT&T and barely escaped a put trade with a profit and it got pretty ugly before I did. So remember, none of this is investment advice. Just a hot take on a stock that I think is hotter than it should be right now. Act accordingly and DYOR.
I get why it has been running - yield is tantalizing in a struggling market, and monthly payouts even more so, I suspect. But I am firmly of the belief that we are headed for some pretty rough times in the economy, and retail real estate, triple net lease or not, is not where I'd want to be, personally. Their top 3 tenants are Dollar General, Walgreens, and Dollar Tree, who are all having their own struggles right now.
6 consecutive up days causing a retail-leveraged REIT to jump almost 10% when economic data is flashing recesssionary warning signals, along with pending inflationary impacts of tariffs does not help its case. So simply as a short term, overbought in a bad space call, I'm expecting
O to go lOwer soon. I'll consider tactically adding to the short and closing when the price is lower than the average lot sales price. This might result in an individual lot ending with a loss, but an overall trade win. With shorts, I don't get hung up on that.
Feel free to disagree, and I could well be wrong. I had the same thesis about 2 months ago on AT&T and barely escaped a put trade with a profit and it got pretty ugly before I did. So remember, none of this is investment advice. Just a hot take on a stock that I think is hotter than it should be right now. Act accordingly and DYOR.
Trade closed: target reached
I'd have closed this out at 56.91 at the close today. I'm no hero when it comes to shorts. A 0.62% gain in 6 trading days isn't great, but it's still better than the market's long term daily average of .043%/day. I'll be posting another short shortly.Note
Trade summary for my recordssWins 1
Losses 0
Avg. gain per lot = +0.62%
Avg holding periods per lot = 6 days
Avg gain/lot/day = +.103%
Annualized RoR = .103% x 252 = +26%
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.