Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Derivatives

<ul>
<li>The global auto industry faces significant tariff exposure. Option implied volatility offers a forward-looking assessment of risk.</li>
<li>Chinese car makers started to increase in implied volatility more than the other markets at the beginning of February. They now show the highest risk.</li>
<li>Recent implied volatility trends, asymmetric pricing (skew), and the term structure all seem to indicate that the Indian auto sector is the least exposed to international trade relations.</li>
</ul>


The global auto industry faces significant tariff exposure. Option implied volatility offers a forward-looking assessment of risk.
Chinese car makers started to increase in implied volatility more than the other markets at the beginning of February. They now show the highest risk.
Recent implied volatility trends, asymmetric pricing (skew), and the term structure all seem to indicate that the Indian auto sector is the least exposed to international trade relations.


EQD | Volatile Roads: Unveiling Risk in the Asian Auto Industry Through the Options Market

<ul>
<li>Japanese Prime Minister Shigeru Ishiba's meeting with US President Trump shines the spotlight on potential US tariffs on Japanese cars. <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota Motor's (7203 JP)</a> high implied volatility expresses elevated risk.</li>
<li>Risk analysis suggests a range of option strategies. Implementation is challenging due to low liquidity in the Japanese market.</li>
<li>Option liquidity is higher in the US traded <a href="https://www.smartkarma.com/entities/toyota-motor-corp-spon-adr" target="_blank" data-smartkarma-citation="entities:8245:1" rel="noopener">Toyota Motor Corp Spon ADR (TM US)</a> which is the preferred route of implementation.</li>
</ul>


Japanese Prime Minister Shigeru Ishiba's meeting with US President Trump shines the spotlight on potential US tariffs on Japanese cars. Toyota Motor's (7203 JP) high implied volatility expresses elevated risk.
Risk analysis suggests a range of option strategies. Implementation is challenging due to low liquidity in the Japanese market.
Option liquidity is higher in the US traded Toyota Motor Corp Spon ADR (TM US) which is the preferred route of implementation.


EQD | Toyota (7203 JP // TM US) - Option Opportunities Amid Tariff Tension

Quantitative Researcher, MRM Research

Nico Rosti

Quantitative Researcher

MRM Research

Quantitative Research

<ul>
<li>A quick synoptic look at the tactical models for the key indices, stocks, commodities and bonds we cover, for the week July 28 - August 1.</li>
<li>
OVERSOLD: <a href="https://www.smartkarma.com/entities/china-mobile-ltd" target="_blank" data-smartkarma-citation="entities:27:1" rel="noopener">China Mobile (941 HK)</a> , <a href="https://www.smartkarma.com/entities/commonwealth-bank-of-australia" target="_blank" data-smartkarma-citation="entities:14:1" rel="noopener">Commonwealth Bank of Australia (CBA AU)</a> are just mildly oversold, <a href="https://www.smartkarma.com/entities/nifty-index" target="_blank" data-smartkarma-citation="entities:23617:1" rel="noopener">NIFTY Index (NIFTY INDEX)</a> is oversold.</li>
<li>
OVERBOUGHT: <a href="https://www.smartkarma.com/entities/amazon-com-inc" target="_blank" data-smartkarma-citation="entities:409:1" rel="noopener">Amazon (AMZN US)</a> , <a href="https://www.smartkarma.com/entities/alphabet-inc-cl-c" target="_blank" data-smartkarma-citation="entities:11369:1" rel="noopener">Alphabet (GOOG US)</a> , <a href="https://www.smartkarma.com/entities/nvidia-corp" target="_blank" data-smartkarma-citation="entities:5891:1" rel="noopener">NVIDIA (NVDA US)</a> , <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota Motor (7203 JP)</a> , <a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a> , <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">Hang Seng Index</a> , <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 INDEX</a> </li>
</ul>


A quick synoptic look at the tactical models for the key indices, stocks, commodities and bonds we cover, for the week July 28 - August 1.

OVERSOLD: China Mobile (941 HK) , Commonwealth Bank of Australia (CBA AU) are just mildly oversold, NIFTY Index (NIFTY INDEX) is oversold.

OVERBOUGHT: Amazon (AMZN US) , Alphabet (GOOG US) , NVIDIA (NVDA US) , Toyota Motor (7203 JP) , Softbank Group (9984 JP) , Hang Seng Index , Nikkei 225 INDEX 


Global Markets Tactical Outlook: Week of July 28 – August 1

Equity Derivatives and Volatility Specialist, Clifton Derivatives

John Ley

Equity Derivatives and Volatility Specialist

Clifton Derivatives

Independent derivative and volatility research firm focusing on events/catalysts, earnings, relative value and cross asset volatility strategies.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899" rel="noopener">Hang Seng Index (HSI INDEX)</a>, <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-index" target="_blank" data-smartkarma-citation="entities:22906" rel="noopener">Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX EQUITY)</a> and <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909" rel="noopener">Nikkei 225 (NKY INDEX)</a> all have elevated implied vols vs their peers and vs historical observations for October.</li>
<li>
<a href="https://www.smartkarma.com/entities/nifty-index" target="_blank" data-smartkarma-citation="entities:23617" rel="noopener">NIFTY Index (NIFTY INDEX)</a> , <a href="https://www.smartkarma.com/entities/s-p-500-index" target="_blank" data-smartkarma-citation="entities:22886" rel="noopener">S&amp;P 500 INDEX (SPX INDEX)</a> and <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a>  implied vols are on the low end of what is typically realized in October.</li>
<li>Most markets see price weakness in the 3rd week of the month with realized volatility underperforming over the back half of the month.</li>
</ul>



Hang Seng Index (HSI INDEX), Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX EQUITY) and Nikkei 225 (NKY INDEX) all have elevated implied vols vs their peers and vs historical observations for October.

NIFTY Index (NIFTY INDEX) , S&amp;P 500 INDEX (SPX INDEX) and S&amp;P/ASX 200 (AS51 INDEX)  implied vols are on the low end of what is typically realized in October.
Most markets see price weakness in the 3rd week of the month with realized volatility underperforming over the back half of the month.


EQD | Asia Monthly Vol Roadmap: Elevated IV's in CSI300 and Hang Seng Present Tactical Opportunity

<ul>
<li>
Context: On 23 July 2025, <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota Motor (7203 JP)</a> surged 14.3%, driven by macro factors tied to tariffs. This Insight examines how that sharp move affected the stock’s volatility surface.</li>
<li>
Key Observations: Implied volatility spiked to extreme percentiles, with two-week IV hitting the 99th–100th percentile. Skew dynamics show otm calls becoming historically rich relative to puts.</li>
<li>
Opportunity: Elevated implied volatility and historically flat skew present an attractive setup for a zero-cost option strategy.</li>
</ul>



Context: On 23 July 2025, Toyota Motor (7203 JP) surged 14.3%, driven by macro factors tied to tariffs. This Insight examines how that sharp move affected the stock’s volatility surface.

Key Observations: Implied volatility spiked to extreme percentiles, with two-week IV hitting the 99th–100th percentile. Skew dynamics show otm calls becoming historically rich relative to puts.

Opportunity: Elevated implied volatility and historically flat skew present an attractive setup for a zero-cost option strategy.


Toyota (7203 JP) Surges 14% — A Contrarian Option Strategy

Japan

Toyota Motor Corporation manufactures, sells, leases, and repairs passenger cars, trucks, buses, and their related parts worldwide. The Company also operates financing services through their subsidiaries. Toyota Motor builds homes, produces pleasure boats, and develops intelligent transportation systems including radar cruise control and electronic toll collection systems.

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Toyota Motor (7203 JP)

EQD | Volatile Roads: Unveiling Risk in the Asian Auto Industry Through the Options Market

Global auto industry faces tariff risk. The option market assigns the highest risk to Chinese car makers. The Indian auto sector appears least...

Gaudenz Schneider

EQD | Toyota (7203 JP // TM US) - Option Opportunities Amid Tariff Tension

Toyota Motor's high implied volatility indicates elevated risk due to potential US tariffs but offers opportunity as well.

Gaudenz Schneider

Global Markets Tactical Outlook: Week of July 28 – August 1

Key indices, stocks, commodities, and bonds forecast for the week July 28 - August 1: NIFTY oversold, while Amazon, Alphabet, NVIDIA, Toyota...

Nico Rosti

EQD | Asia Monthly Vol Roadmap: Elevated IV's in CSI300 and Hang Seng Present Tactical Opportunity

Implied volatility levels across key Asian indices present several tactical opportunities this month for outright or pairs trades...

John Ley

Toyota (7203 JP) Surges 14% — A Contrarian Option Strategy

An opportunity emerges after volatility shifts to extreme levels. Find out how implied volatility reacted to the recent rally and explore a zero...

Gaudenz Schneider

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

EQD | Volatile Roads: Unveiling Risk in the Asian Auto Industry Through the Options Market

​Global auto industry faces tariff risk. The option market assigns the highest risk to Chinese car makers. The Indian auto sector appears least...

Gaudenz Schneider

EQD | Toyota (7203 JP // TM US) - Option Opportunities Amid Tariff Tension

Toyota Motor's high implied volatility indicates elevated risk due to potential US tariffs but offers opportunity as well.

Gaudenz Schneider

Global Markets Tactical Outlook: Week of July 28 – August 1

​Key indices, stocks, commodities, and bonds forecast for the week July 28 - August 1: NIFTY oversold, while Amazon, Alphabet, NVIDIA, Toyota...

Nico Rosti

EQD | Asia Monthly Vol Roadmap: Elevated IV's in CSI300 and Hang Seng Present Tactical Opportunity

​Implied volatility levels across key Asian indices present several tactical opportunities this month for outright or pairs trades...

John Ley

Toyota (7203 JP) Surges 14% — A Contrarian Option Strategy

​An opportunity emerges after volatility shifts to extreme levels. Find out how implied volatility reacted to the recent rally and explore a zero...

Gaudenz Schneider

Global auto industry faces tariff risk. The option market assigns the highest risk to Chinese car makers. The Indian auto sector appears least...

Key indices, stocks, commodities, and bonds forecast for the week July 28 - August 1: NIFTY oversold, while Amazon, Alphabet, NVIDIA, Toyota...

Implied volatility levels across key Asian indices present several tactical opportunities this month for outright or pairs trades...

An opportunity emerges after volatility shifts to extreme levels. Find out how implied volatility reacted to the recent rally and explore a zero...