Hi all,
On the recent COVID variant news and countries like Portugal imposing restriction due to rising COVID cases, I'd like to provide an update on my short thesis on oil.
To summarize, I went short on oil price via put option on oil stocks a while back: https://www.reddit.com/r/Burryology/comments/qxibts/the_final_oil_short_of_2021/
I closed my put position on oil stocks a couple days ago after realizing 40-50% profit because (a) I've never seen that kind of profit in a couple days before and (b) the US new cases are not being accurately tested and accounted for because of the holidays (still rising but clearly not at the same rate).
But I'd like to provide some updated comments on the thesis. On Friday WTI plunged about 10-13% on the news of the new COVID variant and countries like Portugal re-imposing restriction due to rising cases. I certainly did not predict this new variant but I most certainly did predict that some restrictions will happen due to the rising number of cases. Predictably, the oil stocks tanked along with oil.
All in all Friday seems like an over-reaction but my thesis still stands that rising US cases will add more fuel to the oil price decline. The weeks between Thanksgiving and Christmas will be crucial for my thesis. I am holding about 5% cash for now waiting to get back after oil stocks start bottoming. I think that US cases will start peaking around the end of December.
"Looking for value wherever it can be found." - Christian Bale.
Submitted November 28, 2021 at 12:02PM by pml1990 https://ift.tt/318NFDk
