How to Play Home Depot Post Earnings

Kevin discusses the current market updates, focusing on the Dow and S&P 500, and the role of portfolio insurance in the options market. The CBOE skew index is highlighted as a measure of portfolio insurance activity. As volatility decreases, more investors are hedging their portfolios. The discussion shifts to Home Depot's trade strategy, analyzing their capital outlays and stock performance. Kevin suggests buying Home Depot stock and selling a call option to capitalize on elevated volatility and potential stock upside.

What does the CBOE skew index measure?

• The level of market volatility

• The amount of portfolio insurance activity

• The performance of the Dow and S&P 500

• The interest rates set by the Federal Reserve

Why is it advantageous to buy portfolio insurance during low volatility?

• It is riskier

• It is cheaper

• It is less effective

• It is more expensive

What is the relationship between the skew index and the VIX?

• The skew index is unrelated to the VIX

• The skew index is a direct measure of the VIX

• The skew index measures the same as the VIX

• The skew index is a hedge against the VIX being low

What is Home Depot's plan for the next five years?

• To reduce the number of distribution centers

• To add 170 distribution centers

• To increase product prices

• To cut down on capital outlays

How can investors benefit from Home Depot's stock during market headwinds?

• By selling all their shares

• By buying more shares without any strategy

• By avoiding any investment in Home Depot

• By selling a further out of the money call