Another analyst expressed fear of a trade-war escalation. Whether the bears are right depends on tariffs – which now average around 22.5%, noted the Journal – stay where they are or go higher due to tit-for-tat rounds of retaliation from other countries and a U.S. response. Or you could put more cash into a money market fund whose yield would rise if the Federal Reserve were to decide interest rates are too low to fight tariff-induced inflation. President Donald Trump described the market plunge as “medicine,” according to ABC News.

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Top-performing stocks include SanDisk (+7.5%), Intel (+5.433%) and Expand Energy Corp (4.556%). The biggest losing stocks for the session are NetApp Inc (-7.232%), Hewlett-Packard Enterprises (-6.04%) and 3M Co. (-5.775%). With nowhere to hide as investors clean house until the problem goes away, 10 out of 11 major sectors are lower. The S&P 500 sectors’ performance reflects the risk-off selling pressure. Treasuries are dumped and the dollar falls swiftly as foreign investors bring money back home.

Put options, as well as many other types of options, are traded through brokerage platforms. It’s important to understand an option contract’s value and profitability when considering a trade, or else you risk the stock falling past the point of profitability. Different put options on the same underlying asset may be combined to form put spreads. Time decay accelerates as an option’s expiration date gets closer, since there’s less time to profit from the trade. In this strategy, the investor buys a put option to hedge downside risk for a stock held in their portfolio. No information herein is intended as securities brokerage, investment, tax,accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund.

Cantor Fitzgerald’s current target represents 5x projected 2026 sales, which aligns with the company’s three-year average multiple. Its price-to-earnings (P/E) ratio stands at 69.7, and the current price sits near InvestingPro’s fair value assessment. Bears, however, focus on the low free cash flow of $2 million, which was impacted by one-time payments for a cost optimization program. Piper Sandler suggests the stock is undervalued, implying an enterprise value of nearly $9 billion. Bulls point to the company’s 81.55% gross profit margins and the 44% growth in SaaS revenue as evidence of a successful cloud transition. This suggests that the sell-off is specific to Commvault’s internal metrics rather than a broader industry trend.

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The rumored “Cybercab” and the development of a “stripped-down” affordable platform—often referred to as the “Model 2″—are seen as the company’s best chance to tap into the mass-market segment where BYD currently dominates. For the wider market, this signals an era of “protectionist electrification,” where trade barriers may become as common as tailpipe emissions once were. The EU’s move to protect its domestic industry through tariffs and localized subsidies represents a significant pivot away from the free-market idealism that allowed Tesla to flourish in the 2010s. This regulatory creep is forcing Tesla to invest heavily in battery chemistry and material science at a time when its margins are already being squeezed by price wars.

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• According to CNBC, European states are reportedly considering retaliatory tariffs and broader punitive economic counter-measures against the U.S.
• Freedom Capital Markets chief market strategist Jay Woods emailed MarketWatch a scenario where “the U.S. doesn’t back down.”
• It really depends on factors like your trading objective, risk appetite, amount of capital, and other factors.
• Figuring into the economic uncertainty, investors are now left to wait and see how U.S. trading partners respond to the Trump tariffs.
• Key stakeholders, including institutional investors who have long defended Tesla’s premium valuation, are now questioning the company’s “Giga Berlin” strategy.
• Investors will also hear from Federal Reserve Chair Jerome Powell, who faces not only rising recession fears but expectations that tariffs will feed inflationary pressures, clouding the outlook for further interest-rate cuts.

The hycm markets are responding to Trump’s tariff threat in textbook fashion. Volume reflects consolidated markets. Taiwan stocks climbed 1.2% to a record high. On the equities front, South Korean stocks scaled a record high after Trump said that the U.S. and South Korea will work out a solution following his threat of a tariff hike. A strengthening baht threatens Thailand’s export-dependent economy, which has also been pressured by global trade tensions and domestic problems at hand. Meanwhile, the baht pared gains to trade at 31 per dollar after the central bank governor said Thailand will set a cap on daily gold trading to curb the overvalued currency’s strength.

Can I Lose the Entire Amount of the Premium Paid for My Put Option?

• In the previous section, we discussed put options from the perspective of the buyer, or an investor who has a long put position.
• In this case, exercising the put option would result in a short sale of 100 SPY units at the $545 strike price.
• However, outside of a bear market, short selling is typically riskier than buying put options.
• Trump himself acknowledged how the U.S. stock market sold off on Tuesday because of his desire for Greenland, but he called it “peanuts compared to what it’s gone up” in the first year of his second term and said it would go up further in the future.
• The dollar outlay for in-the-money (ITM) puts is higher than for out-of-the-money (OTM) puts because they give you the right to sell the underlying security at a higher price.
• Yale University’s The Budget Lab predicted 2025 tariffs will cause U.S. prices to rise 2.3 per cent in the short-term, the equivalent to a US$3,800 loss per household.

Investors have the option of short-selling the stock at the current higher market price, rather than exercising an OTM put option at an undesirable strike price. Put options are derivatives that give their holders the right, but not the obligation, to sell an underlying asset (e.g., a stock, currency, bond, commodity, future, or index) at a set price by a pre-established date. A number of investors and traders had appeared to be attempting to price in a “sell the rumor, buy the news” scenario, in which the tariff details would potentially mark a market bottom. This highlights the severity of the market’s reaction, which may prompt investors to evaluate when to sell a stock based on specific financial disclosures and restructuring costs.

Futures and futures options trading is speculative and is not suitable for all investors. Options involve risk and are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially significant losses. The BYD Seal and Atto 3 models are now frequently out-selling Tesla’s Model 3 in southern European markets. Today’s reversal marks a 47% decline over the last three months, signaling a sharp shift in market sentiment despite the company’s aggressive share buyback program and double-digit SaaS growth.

According to CNBC, European states are reportedly considering retaliatory tariffs and broader punitive economic counter-measures against the U.S. “The challenge is that we’re probably going to see prices rise gradually and it’s going back to that self-fulfilling (prophecy) and inflationary expectations becoming entrenched.” In comparison, they anticipate consumer price growth in Canada to stretch to more than three per cent this summer. JPMorgan analysts recently said the odds bitcoin brokers canada of a global recession have increased to 60 per cent. The S&P 500 was down more than 17 per cent from its mid-February high on Friday.

If you don’t want to deal with all that risk, make sure you have a deep pool of funds outside of stocks – such as a money market fund – which is likely to maintain or even increase its yield as tariffs boost inflation. We sell different types of products and services to both investment professionals and individual investors. Figuring into the economic uncertainty, investors are now left to wait and see how U.S. trading partners respond to the Trump tariffs. But even bear markets, or when stocks decline at least 20% from their peak, are normal and aren’t a reason to panic, experts say. In other words, traders have had to sell assets to cover their trades, which could be feeding into the stock market declines, experts said.

For a put option buyer, the maximum loss on the option position is limited to the premium paid for the put. Thus, most long option positions that are ITM are sold rather than exercised. Selling the option, rather than going through the relatively convoluted process of option exercise, actually results in a profit of $770, which is $50 more than the $720 made by exercising the option. This is because the option may expire at no value, and this allows them to keep the whole premium. The buyer of a put option doesn’t need to hold the option until expiration. It’s important to identify a broker that’s a good match for your investment needs.

To illustrate, let’s assume an investor wanted to bet $100,000 – purchasing 1,333 shares of VIXY at $75/share – on hopes of a rise in the VIX from 45 to 80 by June 4, 2025. Anticipating this outcome may well be what motivated some prescient traders to bet the VIX would rise a few days after Trump took office, according to my March 5 Forbes post. However, to increase the odds of an optimistic outcome, tariffs would need to decline – well-below March’s 8.6% rate – and Trump would need to stop changing his mind about tariffs every few days.

The two pieces of data spooked investors, deepening fears that the U.S. economy could be sliding into a recession and that the Federal Reserve may have waited too long to cut its benchmark rate. Monday’s sell-off began last week after a monthly U.S. jobs report showed significantly slower hiring, with 114,000 new jobs in July, far fewer than had been forecasted and sharply down from recent months. In Europe, the Pan-European Stoxx 600 index fell 1.5%, rallying from a larger dip earlier in the day, as every major market in Europe declined. Looking ahead, the short-term fundamentals have turned bearish and investors have responded by taking profits and trimming positions.

That was before Trump threatened to impose 10% tariffs on Denmark, Norway, Sweden, Germany, France, the United Kingdom, the Netherlands and Finland for opposing U.S. control of Greenland. That’s almost all the way back to the 4.24% level where it was at on Friday. Buffett said last fall that he was disappointed in Kraft Heinz’ plan to split the company in two, and Berkshire’s two representatives resigned from the Kraft board last spring. The oil field services company rose 4.1% after reporting a stronger profit for the latest quarter than analysts expected. The value of the U.S. dollar, meanwhile, clawed back some of its declines against other currencies after sliding the day before. Besides the progress on Greenland, they also got help from a calming of yields in Japan’s jumpy bond market.

Additionally, SAIC Motor’s MG brand, while still growing, has been forced to absorb nearly 38% in EU tariffs, limiting its ability to compete on price with localized European manufacturers. The initial market reaction has been one of “decoupling,” with Tesla’s stock performance diverging sharply from other tech giants like Microsoft and Apple, as analysts recalibrate their expectations for Tesla’s 2026 delivery targets. The decline in the EU—a region once considered Tesla’s most loyal stronghold—signals a potential “demand cliff” that may force further price cuts, threatening the company’s industry-leading margins just ahead of its highly anticipated Q earnings report. For the first time, market participants are pricing Tesla not as a disruptive tech titan with infinite scale, but as a mature industrial manufacturer facing the same cyclical headwinds and margin pressures as its legacy peers. Some analysts believe the stock is trading at its long-term enterprise value to free cash flow average. With the stock trading at $89.82, CVLT is currently down roughly 41% from its 52-week high of $200.68.

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Along with call options, puts are among the most basic derivative contracts. If you’re new to options and have limited capital, put writing would be a risky endeavor and not a td ameritrade forex review recommended one. Short selling is therefore considered to be much riskier than buying puts. Buying puts and short selling are both bearish strategies, but there are some important differences between the two.