NEWT Forecast


Bullish Case: NEWT's recent 13.8% rise in a week suggests positive momentum, reinforced by call options trading at 81% more volume than puts, indicating bullish sentiment. Lower strike price volatility suggests market expects less downside risk.


Bearish Case: Recent trading volumes show high implied volatility for puts at lower strike prices, indicating bearish sentiment. Price currently at -34.8% from five years ago, with historical returns showing mean reversion.


Potential Outcomes:

1. Moderate increase (50%) as mean reversion continues.

2. Major drop (30%) due to bearish sentiment.

3. High volatility sideways movement (20%) as implied volatility remains high.


Trading Oracle: Adopt a bullish Helium Long Volatility approach: implement a debit call spread by buying Dec 2024 15.00 C and selling Dec 2024 17.50 C. This spread benefits from anticipated moderate price increase with limited risk due to spread structure, targeting high reward:risk ratio.


July 16, 2024


Newtek Business Services Forecast

NEWT      Newtek Business Services











Correlated Assets

Assets that tend to move strongly with NEWT



VFC Forecast + Options Trading Strategies   VFC  VF (0.67)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.49)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.19)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (-0.56)



Uncorrelated Assets

Assets with little price relationship to NEWT



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.19)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.49)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (-0.56)


VFC Forecast + Options Trading Strategies   VFC  VF (0.67)



Anticorrelated Assets

Assets that tend to move strongly against NEWT



VFC Forecast + Options Trading Strategies   VFC  VF (0.67)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.49)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.19)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (-0.56)





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