Market volatility has fallen markedly as measured by the CBOE Volatility (VIX) Index. VIX is a real-time index that represents the market expectation for near-term volatility in the S&P500 index.

Investors and traders have long used VIX as a measure of the level of risk, fear or stress in the market.

Today, we’re going to look at a long call butterfly using VIX options as a way to profit if volatility jumps up again in the next few weeks.

A long call butterfly is constructed through buying a call option, selling two higher calls and buying one call even higher.

The trade is entered for a net debit meaning the trader pays to enter the trade. This debit is also the maximum possible loss.

Usually, a butterfly is placed roughly at-the-money, but today we are looking at placing it out-of-the-money.

Using the May 16 expiry, the trade would involve buying the 20 strike call, selling two of the 25 strike calls and buying one of the 30 strike calls.

The cost for the trade would be around $40-45 which is the most the trade could lose. The maximum potential gain is $460, which would occur is VIX closed right at 25 at expiration. The lower breakeven price is 20.50 and the upper breakeven price is 29.50.

There are three general outcomes with this butterfly.

• VIX below 20.50 – Trade loses $45. This scenario should be reasonably acceptable for most investors. While the option trade suffers a full loss, hopefully stocks have been stable or rising.
• VIX between 20.50 and 29.50 – Good for the VIX butterfly, but potentially bad for stock portfolios.
• VIX above 29.50 – Full loss on the VIX trade and potentially big drops in stock portfolio.

So, VIX above 30 is the main scenario that hurts in this case, but how likely is that? We’ve only seen a VIX reading of above 30 on a handful of days in the last six months.

Using VIX options can be simple and cheap way to buy some protection against a mild selloff in stocks between now and mid-May. The trade can be placed relatively cheaply at $40-45 per contract.

VIX options behave differently to regular stock options, so it is important that any trader using this product fully understands the risks involved. As always, do your own research and due diligence before risking any of your hard-earned capital.

Please remember that options are risky, and investors can lose 100% of their investment. This article is for education purposes only and not a trade recommendation. Remember to always do your own due diligence and consult your financial advisor before making any investment decisions.

• Core Lithium (CXO) posts a 62 per cent increase to the total mineral resource estimate (MRE) of its Finniss lithium project in the Northern Territory
• The total resource now comprises 30.6 million tonnes at 1.31 per cent lithium, with measured and indicated resources of 19.4 million tonnes at 1.37 per cent lithium
• Core says the results highlight the “significant potential” for mine life extensions at Finniss, and it will now work to complete an updated ore reserve estimate
• The company has allocated $25 million to its 2023 drilling campaign — nearly double its 2022 budget — to deliver further resource increases
• CXO shares are up 7.03 per cent and trading at 99 cents at 11:54 am AEST

Core Lithium (CXO) has posted a 62 per cent increase to the total mineral resource estimate (MRE) of its Finniss lithium project in the Northern Territory.

The total resource now comprises 30.6 million tonnes at 1.31 per cent lithium oxide.

Of this, the measured and indicated mineral resources make up 19.4 million tonnes at 1.37 per cent lithium oxide — an increase of 46 per cent from the previous resource.

The update follows the company’s largest drilling program to date: a 39,600-metre reverse circulation and diamond drilling campaign completed in 2022.

The program was conducted at both known deposits and new prospects within the Bynoe pegmatite field, which lies 15 kilometres south of Darwin and extends up to 70 kilometres in length and 15 kilometres in width.

Core said the new results highlighted the “significant potential” for mine life extensions at Finniss, and the company will now work to complete an updated ore reserve estimate.

The company has allocated $25 million to its 2023 drilling campaign — nearly double the budget allocated for 2022 — to deliver further increases to the project’s MRE.

CXO shares were up 7.03 per cent and trading at 99 cents at 11:54 am AEST.

Juniper Networks, Inc. (JNPR), a Communication Equipment business, was a active mover in the prior market session. Juniper Networks, Inc. (JNPR) stock opened the day for trading at $23.28 and closed the day at $23.68 with gains of +2.42%. The increase movement in Juniper Networks, Inc. (JNPR) beat the movement in the S&P 500 for the day which gained +1.69% in prior market day.

Juniper Networks, Inc. (JNPR) is focused on the Communication Equipment sector. This stock market sector has seen some movement from investors in recent market sessions. Bullish investors of Juniper Networks, Inc. (JNPR) will be looking for positive upcoming earnings whereas bearish investors of Juniper Networks, Inc. (JNPR) will be looking for negative earnings. The last time Juniper Networks, Inc. (JNPR) had an earnings surprise was on Qtr Ending 03/20 when they reported $0.11 compared to an estimate of $0.12 which was a difference of -$0.01 resulting in a change of -8.33%. Current earnings estimates are to be released for Current Qtr 06/2020 on Juniper Networks, Inc. (JNPR) and out of 5 Wall Street estimates the average is saying $0.24. The high estimate is saying $0.26 whereas the low estimate is saying $0.21 and the prior year Juniper Networks, Inc. (JNPR) announced earnings at $0.27 a growth rate est. (year over year) of -11.11%.

The market performance of Juniper Networks, Inc. (JNPR) has varied recently. Year to date Juniper Networks, Inc. (JNPR)’s shares are down -3.86%. Over the past 12 weeks Juniper Networks, Inc. (JNPR) is down -5.05% and over the last 4 weeks Juniper Networks, Inc. (JNPR) is up 9.28%. Juniper Networks, Inc. (JNPR) current income statement shows revenue (ttm) of $4.44B. Gross Profit is $2.62B. This puts the current EBITDA of Juniper Networks, Inc. (JNPR) at $708.4M.

Wall street investors might also notice recent changes to stock analyst estimates for Juniper Networks, Inc. (JNPR). The stock is trading with an RSI (relative strength index) of 60.55 indicating Juniper Networks, Inc. (JNPR) is neither overbought nor oversold. Technically, JNPR’s short term support levels are around $1367.66, $1334.96 and $1286.57 on the downside. JNPRs short term resistance levels are $1526.69, $1493.59 and $1432.99 on the upside. The market cap of Juniper Networks, Inc. (JNPR) is $7.846B and institutions hold 96.01% of the stock. The outstanding share count stands at 330.80M while the short float (shares short) stands at 3.53%.

Research indicates that these earning estimate changes look to be directly correlated with short-term stock prices. The investors can look to capitalize on the basis of ranking. Based on technical analysis, JNPR has short term rating of Bullish (0.25), Intermediate rating of Neutral (0.23) and the long-term rating of Bullish (0.39) giving it an overall rating of Bullish (0.29).

The EPS growth this year on Juniper Networks, Inc. (JNPR) is decreased -38.40% and is expected to increase 16.15% next year. However, quarterly earnings (EPS) growth year over year on Juniper Networks, Inc. (JNPR) has decreased by -31.00% and quarterly revenue (Sales) growth year over year stands at -0.40%. Gross margin is detected at 58.80% that represents the percent of total sales revenue that the company retains after direct cost of goods sold. Net profit margin (ttm) is 7.50% while return on equity (ttm) is 7.30%.

Recent Developments:

2020-04-28 – Juniper Networks Q1 Adj EPS $0.23.
2020-04-08 – Finjan Holdings Says PTAB Issued Final Written Decision Finding Finjan’s U.S. Patent No. 6,154,844 Patentable Over Prior Art.
2020-01-27 – Juniper Networks Reports Q4 Non-GAAP Earnings Per Share $0.58.
2019-12-03 – Rostelecom Partners with Juniper Networks, Inc. to Build IP Transport Backbone for Next-Generation Services.
2019-12-03 – CERN Selects Juniper Networks to Increase Network Capacity for Handling Unprecedented Volumes of Data for its Scientific Projects and Everyday Tasks.

About Company:

Based in Sunnyvale, CA, Juniper Networks, Inc. is a leading provider of networking solutions and communication devices. The company develops, designs and sells products that help to build network infrastructure used for services and applications based on single Internet protocol network worldwide.