US Stock Papertrading Season 2: Who's in the top 10 last week?

The top-performing user last week skillfully leveraged options to profit amid market uncertainty. When expecting significant stock price volatility but being uncertain about the direction (up or down), one can use a straddle strategy.

Nvidia has continued to rally following its stock split, leading some investors to increasingly take profits. Additionally, Nvidia's shareholder meeting has further heightened uncertainty. Using the straddle strategy enabled the investor to capitalize on the increased volatility. This strategy has limited losses and unlimited potential gains.

Last week, Nvidia experienced significant volatility, with its stock dropping about 6% to $123.5 over the week, allowing the investor to exercise the put option with a strike price of $135. By doing so, the investor profited from shorting Nvidia.

However, it is important to note that investors using this strategy do not need to predict the stock's direction (up or down). Rather, the strategy is based on the expectation of significant upcoming volatility in the stock's price, essentially betting on increased future volatility.

Single-stock ETFs are leveraged ETFs whose performance is tied to the daily return of an individual stock. For instance, if Tesla stock increases by 2%, a 2x Tesla single-stock ETF would increase by 4%. Leveraged long single-stock ETFs aim to achieve a multiple of their stock's performance, while short single-stock ETFs target the inverse performance. For the seven major tech companies, corresponding single-stock ETFs are available.

Investors can go long directly or even long on a single stock without financing, which can help achieve relatively higher returns. If you want to leverage your returns but are not familiar with options trading, single-stock ETFs are another good choice.

However, single-stock ETFs are not suitable for long-term investments. The daily rebalancing and compounding effects can cause returns to deviate significantly from the performance of the underlying stock, especially if held over multiple days or longer.

Starting this week, the U.S. macroeconomic calendar enters an important phase, and market volatility may increase again. Key events this week include the release of U.S. non-farm payroll data and a speech by Federal Reserve Chairman Jerome Powell. Investors are particularly focused on the non-farm employment data to be released on Friday.

The U.S. Core PCE (Personal Consumption Expenditures) for May, released on June 28, indicated a cooling in inflation. Currently, there is growing interest in rate cut trades, and if the employment market shows further signs of slowing, it could increase the likelihood of the Federal Reserve cutting rates as early as September. This would boost market risk appetite, benefiting highly elastic growth sectors such as tech stocks and digital currencies.

🎁 Rewards：

- 100 points: any participating user with at least 1 post during the event period.

- 1000 points: the top 10 high-quality users with their trading insights, including at least 1 P/L image and a minimum of 10 words in this page.

- AUD50 cash coupon: for the top writer of unique, on-topic, and in-depth trading analyses (including P/L records) throughout the competition.