WSO Forecast


Bullish Case: WSO's long-term growth and strong historical performance, coupled with its large market share and strategic investments, suggest continued upward momentum. Current bullish risk is 49% higher than bearish risk.


Bearish Case: WSO's high price-to-book ratio, elevated implied volatility, and potential overvaluation raise concerns for a correction. Low option trading volume indicates market skepticism.


Potential Outcomes: Steady growth (70% chance), correction due to overvaluation (20%), or increased volatility from market shifts (10%). Helium's higher implied volatility forecast suggests potential near-term volatility.


Trading Oracle: Deploy a credit call spread strategy: Sell the $500 strike call and buy the $520 strike call expiring August 16, 2024. Leverage the flat-term structure and elevated Helium implied volatility for premium decay. This strategy has a high reward-to-risk ratio with a bearish tilt.


July 16, 2024


Watsco Inc. Forecast

WSO      Watsco Inc.











Correlated Assets

Assets that tend to move strongly with WSO



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.85)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.36)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.69)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.78)



Uncorrelated Assets

Assets with little price relationship to WSO



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.36)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.69)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.78)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.85)



Anticorrelated Assets

Assets that tend to move strongly against WSO



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.85)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (0.36)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.69)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.78)





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