Based on last three day's action, we may have a buying panic. So many people got burned so many times, they sell rally. But now, we have four days very strong market. People are panic to buy.
- I added POT as my main tool to ride this market, also added SSRI, one of my long term play.
- I also sold MOS and POT OTM puts, very low strike price to take the premium. I think it's relatively safe to do so.
- I sold OTM calls against some of the POT and MOS I already have, add addtional protection.
Reason I choose POT is following:
- Fed's action is inflationary in the long run, commodities will go up. Unless we have a great depression.
- POT is the largest fertilizer company in the world, and potash has the best price due to tight supply. POT control 22% of world's potash reserve. POT is the best Ag play.
- POT is close to the bottom price of 54, while others already bounced back 20 to 30%. So it's relatively cheap. It's mainly due to funds liquidation. I think people will add back in when new year starts.
- I will reduce positions when S&P rally back over 900.
