RIO Forecast + Trading Strategies



Bearish<—>Bullish



80% Confidence




Bullish Case: Increased global demand for critical minerals and the strategic acquisition of Arcadium position RIO for growth. Options data suggests bullish sentiment with a decreased long-term volatility curve.




Bearish Case: Ongoing operational challenges and geopolitical tensions pose risks. A flat prediction for iron ore shipments and recent reputational issues reflect potential downside pressures.




Potential Outcomes:
  • 45% chance: Growth from clean energy demand increases prices.
  • 35% chance: Operational and regulatory challenges decrease stock value.
  • 20% chance: External shocks cause volatility.




Trading Oracle: Engage in a bullish credit spread by selling $60 puts and buying $57.5 puts, expiring in 45 days. This strategy suits RIO's mean-reverting trend and implied volatility flattening. It capitalizes on potential stability, leveraging a high probability of profit and reasonable risk/reward.



January 17, 2025


Rio Tinto Forecast

RIO        Rio Tinto











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NEP Forecast + Options Trading Strategies   NEP  NextEra Energy (0.7)


GRWG Forecast + Options Trading Strategies   GRWG  GrowGeneration (0.62)


TAL Forecast + Options Trading Strategies   TAL  TAL Education (0.61)


SNAP Forecast + Options Trading Strategies   SNAP  Snapchat (0.6)



Uncorrelated Assets

Assets with little price relationship to RIO



DHC Forecast + Options Trading Strategies   DHC  Diversified Healthcare (-0.0)


MCD Forecast + Options Trading Strategies   MCD  McDonald's (0.0)


FANG Forecast + Options Trading Strategies   FANG  Diamondback Energy (-0.0)


APH Forecast + Options Trading Strategies   APH  Amphenol (0.0)


VOD Forecast + Options Trading Strategies   VOD  Vodafone (-0.0)



Anticorrelated Assets

Assets that tend to move strongly against RIO



ICE Forecast + Options Trading Strategies   ICE  Intercontinental Exchange (-0.55)


CYBR Forecast + Options Trading Strategies   CYBR  CyberArk Software (-0.57)


SHW Forecast + Options Trading Strategies   SHW  Sherwin-Williams (-0.57)


CINF Forecast + Options Trading Strategies   CINF  Cincinnati Financial (-0.59)


CBRE Forecast + Options Trading Strategies   CBRE  CBRE (-0.6)









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