Kimble Charts: South Korea's EWY
By Ilene
Chris Kimble likes the iShares MSCI South Korea Capped (EWY), but only if it breaks out of a pennant pattern. This South Korean equities ETF has underperformed the S&P 500 by 60% since 2011.
You're probably familiar with its largest holding, Samsung Electronics Co Ltd, and at least several other represented companies such as Hyundai Motor Co and Kia Motors Corp.
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Option idea from Phil: If the EWY breaks higher, a good way to leverage the return would be a 6-month play like buying the October $53 calls at $5.40, selling the October $58 calls for $2.55, which would be a net cost of $2.85 on the $5 spread that's already $3.86 in the money. The upside potential if EWY is over $58 in October is $2.15 or 75% ($5 minus $2.85), not bad for 6 months and you don't lose money until EWY is below $52.85, which would be clearly AFTER it fails the long-term support Chris is indicating.
