I've exited my short CBA position. Lucky I bought a put when it...

I've exited my short CBA position. Lucky I bought a put when it hit $165 was able to profit and claw back a lost premium from an earlier put. Ill break about even, maybe lose about $60 in brokerage fees buying and selling. So barely a loss at all.

One thing that I have learnt from watching CBA daily since September last year. Is institutions will buy CBA simply because our miners are facing the prospect of its best days being behind them as China matures/contracts. Today is a good example, big sell off for the miners and the banks made a slight gain. Our tech sector is not mature in terms of earnings - the price multiples on Pro Medicus, Wisetech, Xero are insanity. Healthcare has even taken a battering in this country. Therefore the majority of ASX earnings that can be counted on in the future, are the banks, and with increased superannuation, I believe fund managers are going to keep throwing money into the banks due to lack of alternatives. TINA - there is no alternative. I can also see an uplift in the share price if it becomes apparent the liberals are going to win the election. Dutton is already talking about demand side policies to housing (using 50k from super for a first home deposit for one) which could deliver loan growth. In this environment any excuse to buy banks shares will be acted on.

I don't think it matters if its horribly overvalued. Due the composition of our market & economy, CBA might hold up a very high price multiple for a long time. The fact the market for almost six months would rather own CBA on a 100%+ premium to BHP is pretty telling. Plus CBA like Qantas is an Australian institution - many CBA shareholders just like owning it.

Mind you if it gets to $170 ill get in another put. My first mistake was buying an out of the money put option needing a -20% decline for the put to be in the money. I would instead look for put options needing -7-8% drops to be in the money. Get in following a rapid increase were the share price touches a new high, because one thing I am sure about, is CBA will continue to be very volatile at these heights.