OZK Forecast


Bullish Case: Bank OZK shows steady earnings and a dividend increase. Historical returns suggest probability of positive performance for holding periods of up to two years, supported by lower implied volatility after upcoming expirations.


Bearish Case: Significant insider stock sales, sector-wide exposure to high-interest commercial real estate, and backwardation in volatility term structure imply potential downside risks. Backwardation suggests short-term volatility risk.


Potential Outcomes:

1. 55% chance OZK appreciates to $49 driven by earnings growth and bullish risk indicators.

2. 35% chance price lowers toward $35 due to sector pressures and high CRE exposure.

3. 10% chance of minimal movement given mixed market indicators.


Trading Oracle: Bearish Credit Spreads (Helium Short Volatility) focusing on the near-term (Aug expirations). Exploit backwardation and higher near-term IV by entering bear call spreads at $47.50 strikes with moderate deltas to capture premium from expected volatility decay. High reward:risk given sector outlook and term structure.


July 19, 2024


Bank OZK Forecast

OZK      Bank OZK











Correlated Assets

Assets that tend to move strongly with OZK



KRE Forecast + Options Trading Strategies   KRE  SPDR S&P Regional Banking (0.93)


DPST Forecast + Options Trading Strategies   DPST  Direxion Daily Regional Banks Bull 3X Shares (0.9)


ARE Forecast + Options Trading Strategies   ARE  Alexandria Real Estate (0.84)


DOCU Forecast + Options Trading Strategies   DOCU  DocuSign (0.83)


KHC Forecast + Options Trading Strategies   KHC  Kraft Heinz (0.83)



Uncorrelated Assets

Assets with little price relationship to OZK



PBF Forecast + Options Trading Strategies   PBF  PBF Energy (-0.0)


BCE Forecast + Options Trading Strategies   BCE  BCE (-0.0)


ALGN Forecast + Options Trading Strategies   ALGN  Align Technology (0.0)


GLNG Forecast + Options Trading Strategies   GLNG  Golar Lng (0.0)


ABR Forecast + Options Trading Strategies   ABR  Arbor Realty (-0.01)



Anticorrelated Assets

Assets that tend to move strongly against OZK



DXD Forecast + Options Trading Strategies   DXD  ProShares UltraShort Dow30 (-0.62)


DOG Forecast + Options Trading Strategies   DOG  ProShares Short Dow30 (-0.63)


TZA Forecast + Options Trading Strategies   TZA  Direxion Daily Small Cap Bear 3X Shares (-0.64)


UUP Forecast + Options Trading Strategies   UUP  Invesco DB US Dollar Index Bullish (-0.68)


DRV Forecast + Options Trading Strategies   DRV  Direxion Daily Real Estate Bear 3X Shares (-0.72)





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