EFA Forecast + Trading Strategies


Bullish Case: The iShares MSCI EAFE ETF (EFA) shows modest price growth, supported by positive global economic data and central bank policies. Recent foreign currency hedged funds outperforming and persistent demand for international equities offer a bullish outlook.


Bearish Case: High-volume put options and slight decline in EFA's recent prices indicate bearish sentiment. Macroeconomic risks, including rising interest rates and geopolitical tensions, could lead to a further decrease in global equity prices, especially in developed markets.


Potential Outcomes: Probability of price maintaining flat or slight increase: 55%. EFA faces potential moderate decline: 30%. Significant market downturn due to global economic events: 15%. These outcomes are based on recent option volumes, historical price return data, and volatility surface analysis.


Trading Oracle: Given the flat volatility term structure and increased put volume, a bearish debit spread (Helium Long Volatility) strategy is viable. Buy EFA July 19, 2024, $78 puts and sell $77.50 puts. Expect 56% profit probability with favorable return on risk, and consider re-evaluation in ~3 weeks.


June 30, 2024


BTC iShares MSCI EAFE Forecast

EFA      BTC iShares MSCI EAFE











Correlated Assets

Assets that tend to move strongly with EFA



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.93)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.46)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.66)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.67)



Uncorrelated Assets

Assets with little price relationship to EFA



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.46)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.66)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.67)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.93)



Anticorrelated Assets

Assets that tend to move strongly against EFA



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.93)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.46)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.66)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.67)





Become a more profitable investor with AI optimized trading strategies






×

Chat with EFA


 Ask any question about EFA!