MARA for Bitcoin Exposure: Top Trade Q1 2022

Digital belongings have been one of many tales of 2021 however have been largely untradeable exterior of spot buying and selling as a consequence of measurement and lack of choices availability. /BTC the bitcoin futures commerce at a 5 Bitcoin notional worth, whereas /MBT the micro contract at 1/10th the dimensions could be a bit too small, and neither have a liquid choices market.

MARA is a digital asset mining firm with a rolling correlation to /BTC above 0.50 and as excessive of 0.80. For context, that is roughly the vary of correlation between AAPL, the biggest part weighting of the SP500, and SPY the SP500 ETF.

With appreciable name aspect skew within the choices pricing and volatility closely skewed within the brief durations, MARA units up as an attention-grabbing lengthy diagonal play to the upside. If this continues into 2022, shopping for the 40 delta name possibility within the 40-70 day vary and promoting the 20 delta shorter length name (15-30 DTE) ought to arrange as an affordable lengthy delta play with excessive optimistic gamma publicity and simply sufficient theta to offset brief time period strikes to the draw back.

MARA:/BTC Rolling Correlation

Supply: tastytrade

— Written by Nick Battista, Host of Choices Buying and selling Ideas LIVE