EFC Forecast


Bullish Case: EFC's innovative Neon Gas Recycling System enhances sustainability, attracting ESG investors. With a 13.43% annual yield, it remains attractive amid flat price actions and potential recovery in market sentiment.


Bearish Case: High implied volatility suggests market uncertainty, raising the risk of a price decline, especially with a significant volume of put options. Continued flat price action may deter income investors seeking growth.


Potential Outcomes:

1. 60% chance of continued flat trading;

2. 20% chance of price rebound with dividends appealing to income investors;

3. 20% chance of further decline due to high market volatility.


Trading Oracle: Implement short-term credit spreads (Helium Short Volatility) on EFC, capitalizing on high implied volatility while expecting flat to bearish movements over the next 2-4 months. Focus on low-cost put options to capture premium and limit risk.


July 25, 2024


Ellington Financial Forecast

EFC      Ellington Financial











Correlated Assets

Assets that tend to move strongly with EFC



VFC Forecast + Options Trading Strategies   VFC  VF (0.72)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.46)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.39)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (-0.55)



Uncorrelated Assets

Assets with little price relationship to EFC



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.39)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.46)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (-0.55)


VFC Forecast + Options Trading Strategies   VFC  VF (0.72)



Anticorrelated Assets

Assets that tend to move strongly against EFC



VFC Forecast + Options Trading Strategies   VFC  VF (0.72)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.46)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.39)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (-0.55)





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