How Benchmark's Kevin Kelly Is Trading Alibaba

The video discusses the breakdown of sector correlations, particularly between the Dow and NASDAQ, and the rotation into defensive groups. It highlights the widening divergence in correlations since May, influenced by the Fed's rate hikes. Technology shows negative correlations with staples and utilities, while materials have a high correlation with technology. The market is still finding its footing, with sector rotations evident. An investment opportunity in Alibaba is explored, suggesting a strategy involving options to capitalize on its current market position.

What has been observed in the sector correlations between the Dow and NASDAQ?

• They have shown no significant change.

• They have remained stable.

• They have broken down.

• They have become more aligned.

Which sector showed a negative correlation with technology?

• Industrials

• Consumer staples

• Materials

• Financials

What is the current correlation between technology and materials?

• 30%

• 83%

• 5%

• 63%

Which sector are investors moving away from as the Fed raises rates?

• Utilities

• Materials

• Consumer staples

• Technology

What strategy is suggested for gaining exposure to Alibaba?

• Investing in a tech ETF

• Short selling Alibaba stocks

• Buying Alibaba stocks directly

• Selling a put and buying a call spread