HERO Forecast


Bullish Case: HERO is showing relative strength with an implied volatility drop in long-term out-of-the-money puts, indicating potential bullish sentiment. Historical returns also reflect a higher likelihood of positive outcomes over extended holding periods.


Bearish Case: Despite recent gains, HERO exhibits high short-term volatility. Implied volatility surfaces reflect traders pricing in potential downward shocks ahead. Negative historical returns are particularly prominent over shorter holding periods.


Potential Outcomes: Significant outcomes:

1) Bull run with 40% probability given strong sector trends.

2) Short-term correction with 30% chance due to current high volatility.

3) Neutral trend continuation with 30% probability aligning with current AI forecast.


Trading Oracle: Deploy a bullish debit spread, focusing on options with longer-term expirations to minimize fallout from interim volatility spikes. Target $22-$25 strike calls for Nov 2024. This strategy leverages the implied volatility skew and aligns with a high likelihood of positive return over extended periods.


June 27, 2024


Global X Video Games & Esports Forecast

HERO      Global X Video Games & Esports











Correlated Assets

Assets that tend to move strongly with HERO



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.69)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.21)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.37)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.44)



Uncorrelated Assets

Assets with little price relationship to HERO



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.21)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.37)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.44)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.69)



Anticorrelated Assets

Assets that tend to move strongly against HERO



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.69)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.21)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.37)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.44)





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