BMO Forecast


Bullish Case: BMO's strategic investments may lead to growth, sustained by a favorable dividend yield of 5.4%. Recent insider buying signals confidence, and implied volatility suggests potential positive price action ahead.


Bearish Case: Ongoing global banking instability and flat term structure coupled with low implied volatility indicate muted price movement. Current price stagnation reflects market caution, pointing to potential downside risks.


Potential Outcomes:

1. Continued flat performance (40%);

2. Positive earnings report incentive for growth (30%);

3. Negative impact from global banking issues (20%);

4. Sharp market recovery rally (10%).


Trading Oracle: Adopt a bullish strategy by implementing a debit spread with a $90 call option, targeting August 2024 expiration. Given current flat volatility, this approach balances risk and potential for high return from price recovery.


July 25, 2024


Bank of Montreal Forecast

BMO      Bank of Montreal











Correlated Assets

Assets that tend to move strongly with BMO



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.52)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.11)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.15)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.2)



Uncorrelated Assets

Assets with little price relationship to BMO



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.11)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.15)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.2)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.52)



Anticorrelated Assets

Assets that tend to move strongly against BMO



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.52)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.11)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.15)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.2)





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