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Generac Holdings Inc Risk Points versus Technology




Generac Holdings Inc (NYSE:GNRC) Risk Points versus Technology (XLK)

Date Published:


PREFACE
This is a scatter plot analysis of the critical risk points from the option market for Generac Holdings Inc (NYSE:GNRC) compared to its own past and the Technology ETF. In order to examine the forward looking risk for Generac Holdings Inc (NYSE:GNRC) the next 30-days, we must look to the option market.

Now, before we dive into the analysis on GNRC, we make one critical note since we're talking about options:



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In the "Why This Matters" section at the end of this article on Generac Holdings Inc (NYSE:GNRC) , we're going to take a step back and show in great specificity that there is actually a lot less "luck" in successful option trading than many people know.

But that's at the end, now let's jump back into the risk point charting and number crunching for Generac Holdings Inc (NYSE:GNRC) . We start by noting that GNRC is in the electrical equipment sector which means along with some other industries we also compare the company to the closest match we could find, which was the Technology ETF (XLK) as a proxy for Generac Holdings Inc.

We have highlighted the IV30® for XLK and for GNRC in the table below.


SNAPSHOT SUMMARY
CONTEXT: THE INDICES
S&P 500 (SPY) IV30     11.15%
Nasdaq 100 (QQQ) IV30     12.44%
Technology ETF (XLK) IV30     12.46%
Biotech (IBB) IV30     18.5%


Generac Holdings Inc (NYSE:GNRC)
GNRC 52 Week Low IV30     24.47%
GNRC Current IV30     43.2%
GNRC 52 Week High IV30     55.32%

GNRC Current HV30     28.13%

Generac Holdings Inc Implied Risk Scatter Plot
(a new risk chart, built for option traders)



Scatter Plot Risk Legend
The blue point is the current 30-day implied volatility for Generac Holdings Inc.
The black point is the current 30-day implied volatility for the Technology ETF (XLK).
The red point is the 52 week low in IV30® for Generac Holdings Inc.
The green point is the 52 week high in IV30® for Generac Holdings Inc.

The various other scatter plot points in the middle give us risk context outside of the electrical equipment sector.

The IV30® is the risk reflected by the option market in the stock price for the next 30 calendar days.

* We can see that the risk as reflected by the option market for the next 30-days for Generac Holdings Inc is above all the indices we have charted including the Technology ETF (XLK).

* We can further see that the current IV30 for Generac Holdings Inc of 43.2% is closer to the annual high of 55.32% than the annual low of 24.47%. Simply stated, this means that the option market is pricing less risk than the average over the past year.

* For some context, we note that the annual range in IV30® for the Technology ETF is between [9.36%, 21.75%] while Generac Holdings Inc has had a range of [24.47%, 55.32%].

Get this same analysis on any ticker here:


A New Kind of Risk Point Chart
This is chart was developed for the trader. It allows us to easily see where the forward looking risk for Generac Holdings Inc (NYSE:GNRC) lies relative to the last year, and the various major stock groupings and the Electrical Equipment sector without using time series data, which can confuse the information.