Watch this video below on how to attack the $BABA opportunity by trading $YHOO. The $YHOO short was the easiest trade during the $BABA IPO session. Watch Bella explain this excellent risk/reward trade with SMB’s new traders.
“You can be better tomorrow than you are today!”
Mike Bellafiore is the Co-Founder of SMB Capital and SMBU, which provides trading education in stocks, options, forex and futures. Bella is the author of One Good Trade and The PlayBook.
He welcomes your trading questions at [email protected]
no relevant positions
Why trade yahoo and not ebay or amazon? To me they seem nearer to baba than yahoo.
Also, what if it rested a bit and continued up?
Yahoo owns a stake in BABA which has been sited as the reason it has been trading higher. A thesis on the Street was once BABA opened to fade YHOO. This is just a thesis. Some thought YHOO would most be correlated with the BABA open.
I hope that helps.
Good job by you thinking through this opportunity.
Stake by yahoo in baba means both should move in the same direction. Since yahoo was showing hesitation to move up while baba was moving up – there was a divergence in behavior and hence the possibility of trade as yahoo was weak on relative basis. Break below crucial level by insti money just confirmed it I guess. Thanks a lot for this wonderful clip.
you are welcome. thxs for the comments and contributing.