The new year is already off to a good start, with the Dow Jones Industrial Average (DJI) and the S&P 500 Index (SPX) with a new record is closed under their belts. For investors looking to maintain this momentum in the first quarter, senior quantitative analyst Rocky White put together a list of the 25 best stocks to own during this period.
Although Steel Dynamics Inc (NASDAQ:STLD) The stock doesn’t top the overall list, but rather leads in terms of largest percentage gains. The stock finished the first quarter up in eight of the last 10 years, with an average pop of 16.6%, snubbing competitor Nucor (NUE).
At last glance, STLD is down 2.3% to trade at $168.63, after BlueScope Steel rejected the company’s $8.92 billion joint takeover offer with SGH. Shares still have a 41.3% year-over-year lead and remain within striking distance of their Dec. 23 all-time high of $178.36. The 40-day moving average is also looking for positions to contain further losses.
Options traders are leaning extremely bullish towards the steel stocks. This is based on STLD’s 50-day buy/sell volume ratio of 3.25 on the International Stock Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which is above 79% of yearly readings.
It is also worth noting that short-term options traders are currently pricing in expectations of low volatility. This is due to the stock’s Schaeffer Volatility Index (SVI) of 39%, which is in the 20th percentile readings over the past year.