SCM Forecast


Bullish Case: SCM's AI price forecast is +0.15% and upward revisions in earnings estimates make it an attractive buy. Historical data shows likelihood of small positive return over next few years.


Bearish Case: High implied volatility for near-term put options signals potential downside risk. SCM has underperformed long-term compared to 10 years ago, suggesting weak fundamental momentum.


Potential Outcomes:

1. Small positive return (60% likelihood) from mean-reversion.

2. Moderate downside (30% likelihood) due to market sentiment.

3. Strong upside (10% likelihood) due to positive earnings surprises.


Trading Oracle: Engage in credit spreads (Helium Short Volatility) based on the prevailing market conditions. Utilize out-of-the-money (OTM) puts on near-term expiration dates due to high implied volatility. This strategy leverages high reward:risk with a positive edge and high probability of profit.


June 30, 2024


Stellus Capital Investment Forecast

SCM      Stellus Capital Investment











Correlated Assets

Assets that tend to move strongly with SCM



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.6)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.34)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.11)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.18)



Uncorrelated Assets

Assets with little price relationship to SCM



VFC Forecast + Options Trading Strategies   VFC  VF (-0.11)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.18)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.34)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.6)



Anticorrelated Assets

Assets that tend to move strongly against SCM



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.6)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.34)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.11)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.18)





Become a more profitable investor with AI optimized trading strategies






×

Chat with SCM


 Ask any question about SCM!