JP Morgan recommends betting on AMD for a short-term pop from cryptocurrency conference hype

Investing & Retiring

The digital currency conferences this week in New York City present an attractive trading opportunity in AMD, according to J.P. Morgan.

“Over the last three years, AMD has staged significant rallies following the blockchain technology summit, Consensus,” J.P. Morgan equity derivatives strategist Shawn Quigg wrote in a note to clients Monday. “We like the reward-risk of owning upside in AMD given its historical returns following the summit, cheap implied volatility and high short interest, which could add a short-squeeze component to the trade.”

CoinDesk’s Consensus three-day conference started Monday. The conference is now the centerpiece of a full-blown “Blockchain Week NYC,” an event run in partnership with the New York Economic Development Corporation.

Quigg said AMD shares rose about 15 percent on average over the last three years during the month after the conference.

As a result, the strategist recommended buying the AMD June $13 strike call option.

A call option gives an investor the right to buy a stock at a certain price during a particular time period. It rises in value as the underlying security’s price goes higher.

Cryptocurrency miners use graphics cards based on AMD’s and Nvidia’s chips to “mine” new coins, which can then be sold or held for future appreciation.

Options trading is typically for sophisticated investors and not for the faint of heart.

AMD shares rose 2.6 percent Monday after the report.

Source link

Products You May Like

Articles You May Like

Fiat Chrysler CEO’s bumpy first six months at helm following Marchionne’s death
Here’s how to avoid disinheriting your kids after a remarriage
Tiffany holiday sales fell
Johnson and Johnson q4 earnings 2018
Hyundai cleans up at Oscars of the automotive industry with big wins

Leave a Reply

Your email address will not be published. Required fields are marked *