VVV Forecast


Bullish Case: VVV has shown strong price appreciation over the past five years and is trading above historical levels. The current term structure shows resilient volatility which, coupled with recent commercial real estate expansions, suggests potential for continued growth.


Bearish Case: VVV's high price-to-book ratio and past collections of insider sales raise concerns about overvaluation. Coupled with mean reverting historical price behavior and recent stagnation, there is a risk of correction if growth falters.


Potential Outcomes: Continued price increase to $45 (60%), corrections due to overvaluation (25%), mean reversion resulting in sideways trading (15%).


Trading Oracle: Sell out-of-the-money bull put spreads expiring within three months targeting medium-term gains. Utilize credit spreads (Helium Short Volatility) as the volatility surface and term structure suggest relatively low near-term premiums. This strategy leverages mean reversion tendencies while providing a favorable risk-reward profile.


June 30, 2024


Valvoline Forecast

VVV      Valvoline











Correlated Assets

Assets that tend to move strongly with VVV



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.84)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.45)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.54)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.59)



Uncorrelated Assets

Assets with little price relationship to VVV



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.45)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.54)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.59)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.84)



Anticorrelated Assets

Assets that tend to move strongly against VVV



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.84)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.45)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.54)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.59)





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