With inflation imposing a very real concern across the economy, it’s difficult to find value — even from traditional value leaders like fast-food giant McDonald’s (MCD). However, for aggressive bullish speculators, MCD stock could be due for a possible comeback. In addition, one of the call option spreads may be underpriced relative to the historical risk that traders are expected to incur.
Mechanically, I’m working with two presuppositions. First, I operate under the framework that the future market returns for MCD stock represent dependent variables. Basically, this concept means that the future outcome of McDonald’s market value depends heavily on its immediate circumstances. Second, I believe that order flow imbalances trigger responses that cannot readily be explained as random.
