Wild Times In Stocks

Currently momentum gauge sentiment and money flow indicators are negative with declining conditions and increasing negative momentum through last week. A decline to 2745 levels seems likely barring any further changes in macro-economic events. We wish to emphasize that long volatility is a tough position that is very likely to lose money. However, for the right purpose and at the right time - it can be a great hedging tool.

As a matter of fact, at the Wheel of FORTUNE, we just executed such a trade. On July 31st, as a measure of protection ahead of the FOMC meeting/decision, we bought UVXY 08/02/2019 26.00 CALL for $0.60. Two hours later, we sold it for $2.40.

Now, if you think we are selling you the 300% return - you're damn wrong! What we actually try to describe is that certain trades/strategies are only appropriate for certain purposes and specific times. To wit:

We are very proud of our risk-adjusted returns but we never sell returns. Never! Instead, we are selling our methodology, our thinking, our risk/reward approach, that may slightly under-perform a 20% rallying stock market, but is certain to out-perform, meaningfully, a market that is using the elevator on its way down.

By the way, anyone who kept this option for 48 hours (till Friday) could have sold it for a 1000% gain. Yes, had we haven't closed it quickly, due to its nature (playing defense, not offense!) this trade (after less than two days) was a 10x multi-bagger.

And if you decided to roll this trade and buy the exact same option, but with a future (down the road) expiry date - you're sitting on a massive gain today.

Again, for us this was about playing defense, not offense. As such, once the option fulfilled its part - we let it go. There are other-different hedges that we keep for longer periods. It all depends on the purpose of the stock trading.

Two conditional signals that are very important to watch:

Avoid/Minimize trading when the Negative score is higher than the Positive momentum score.
Avoid/Minimize trading when the Negative score is above 70 on the gauge.

Be sure to read this article:

Profiting With Volatility Gains As The Fed Drains for additional details, signals and profitable trades in VelocityShares Daily 2x VIX Short-Term ETN (TVIX) to trade the signals for maximum profitability. Additional volatility instruments include the iPath S&P 500 VIX Short-Term Futures ETN (VXX), the ProShares Short VIX Short-Term Futures ETF (SVXY), the ProShares Ultra VIX Short-Term Futures ETF (UVXY), the iPath Series B S&P 500 VIX Short-Term Futures ETN (VXXB), the ProShares VIX Short-Term Futures ETF (VIXY), among others.

Avantor IPO swells to $3.33B after options exercised

Radnor-based chemical and laboratory products supplier Avantor closed its initial public stock offering, which swelled to $3.33 billion after underwriters exercised their full option to purchase additional shares to cover overallotments.

Avantor [NYSE: AVTR) ended up selling 238.05 million shares of common stock at $14 per share.

This year only Uber's $8.1 billion IPO, completed earlier this month, was larger.

Avantor, previously the specialty chemicals division of Covidien Inc., has its corporate headquarters in Radnor, Pa., and offices in Allentown. Two years ago, Avantor acquired lab products supplier VWR Corp., which was based in Radnor, in a deal valued at about $6.4 billion.

The company has a catalog of nearly 6 million chemicals, lab supplies and other materials it distributes to life sciences companies, educational and research institutions, government agencies, and the makers of applied materials in 180 countries worldwide.

Avantor also announced Thursday the closing of its concurrent public offering of 20.7 million shares of convertible preferred stock at $50 per share — which is expected to generate net proceeds of $4.24 billion after underwriting discounts and commissions and offering expenses are deducted.

The company used more than $2.6 billion in proceeds from the two offerings to redeem all outstanding shares of its Series A preferred stock, and another $1.6 billion to pay down debt.

Avantor’s common stock opened at $16.70 per share Thursday morning on the New York Stock Exchange under the symbol “AVTR NYSE.”

Goldman Sachs & Co. and J.P. Morgan served as the joint book-running managers and as representatives of the underwriters for the offerings.

Article come from: https://www.bizjournals.com/philadelphia/news/2019/05/22/avantor-ipo-33b-radnor-chemicals-laboratory.html?ana=yahoo&yptr=yahoo