TWO Forecast + Trading Strategies



Bearish<—>Bullish



80% Confidence




Bullish Case: Stable implied volatility and undervalued P/B ratio suggest potential price increase if market conditions stabilize.




Bearish Case: High implied volatility and poor interest spread management continue to risk further price declines, reflecting negative sentiment.




Potential Outcomes: 10% strong results lead to price rise; 40% flat due to stagnant market; 50% decline from mismanaged spreads.




Trading Oracle: Execute bearish credit spreads at $12.00 strike, selling $11.00 puts. Target a short-term horizon with high-probability of profit due to persistent bearish sentiment and flat IV. Capture potential downside while maintaining reward-to-risk ratio.



December 26, 2024


Two Harbors Investment Forecast

TWO        Two Harbors Investment











Correlated Assets

Assets that tend to move strongly with TWO



NOVA Forecast + Options Trading Strategies   NOVA  Sunnova Energy International (0.68)


UWMC Forecast + Options Trading Strategies   UWMC  UWM Holdings Corporation (0.66)


LCID Forecast + Options Trading Strategies   LCID  Lucid (0.65)


CNXC Forecast + Options Trading Strategies   CNXC  Concentrix (0.63)


OLED Forecast + Options Trading Strategies   OLED  Universal Display (0.62)



Uncorrelated Assets

Assets with little price relationship to TWO



CWH Forecast + Options Trading Strategies   CWH  Camping World (-0.0)


DAR Forecast + Options Trading Strategies   DAR  Darling Ingredients (0.0)


GL Forecast + Options Trading Strategies   GL  Globe Life (-0.01)


FCX Forecast + Options Trading Strategies   FCX  Freeport-McMoRan (0.01)


COMM Forecast + Options Trading Strategies   COMM  CommScope (0.01)



Anticorrelated Assets

Assets that tend to move strongly against TWO



TCMD Forecast + Options Trading Strategies   TCMD  Tactile Systems Technology (-0.53)


EMR Forecast + Options Trading Strategies   EMR  Emerson Electric (-0.54)


TMV Forecast + Options Trading Strategies   TMV  Direxion Daily 20+ Year Treasury Bear 3X Shares (-0.54)


OWL Forecast + Options Trading Strategies   OWL  Blue Owl (-0.56)


CG Forecast + Options Trading Strategies   CG  Carlyle (-0.64)









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