Interest Rate Sensitive Utilities

The amount of money pouring into utilities is no joke. In a world of slow growth, low interest rates, and trade uncertainty... utilities are a no-brainer with stable earnings and dividends. But like anything that can seem like a no-brainer, over-crowed pilling occurs and price extension of the underlying can cause unrealistic valuation to long term perspectives. If you believe interest rates could rebound from historical lows than rotational selling of utility stocks could occur as portfolio managers reduce their exposure and lock in profits.

XLU has good option liquidity and I recommend call credit spreads and debit put spreads into Oct/Nov.

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Short term - We could rise here.

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This one is fun to hit the play button .