Telecom Multi-Way

I used the weakness this morning to initiate some of a Telecom multi-way spread. This spread is constructed in a similar manner to some of the Railway multi-way spreads I’ve traded in the past.

The spread consists of BCE, TU, Q on the long side and VZ, FTR, T on the short side.

There are multiple themes at work in this spread including seasonality, currency, strong trend, strong relative value, and a breakout. In other words, this spread is constructed so that it has many ways to win. There are ways to lose as well, so I will be keeping a close eye on this one.  There is also the issue of the CTL / Q merger.  I will closely monitor this relationship.

I will be varying the ratios in the mix depending on how the market moves in the next week. My general premise is to be long into the new year, and I want to be able to lean on different stocks in the spread so that I don’t get shaken out too easily.

At the moment, the spread looks something like this:

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