After Cramer Called This Stock A Great Inflation Hedge, Buying This Option Would Have More Than Doubled Your Money - Rio Tinto (NYSE:RIO)

Prominent market commentator Jim Cramer on CNBC’s “Mad Money Lightning Round” said on Monday that Rio Tinto Plc RIO is a great hedge against long-term inflation. Shares of the company closed over 4% higher on Tuesday on the NYSE as iron ore prices rose above the $100 mark for the first time since September.

Also Read: Best FTX Alternatives: How To Keep Your Crypto Safe

If you had followed Cramer’s advice on Monday evening and bought Rio’s 70-Strike Call option expiring on Dec. 16 near its opening price of $0.5 on Tuesday morning, by the end of the session, you could have more than doubled your money. Barchart data shows the option closed at $1.23, albeit with low volumes. A call option rises in value when the stock price increases.

Interestingly, Rio Tinto is planning to invest a further $600 million in renewable energy assets in the Pilbara to decarbonize its Western Australian iron ore operations.

The investment will fund the construction of two 100 MW solar power facilities, as well as 200MWh of on-grid battery storage in the Pilbara by 2026. This is in addition to the 34 MW of solar power installed at the recently commissioned Gudai-Darri iron ore mine, a statement said.

Benzinga’s Take: The stock broke out of its near-term resistance area of $66.43-$66.68 range on Tuesday. The next two hurdles for the stock are expected to be near the $72.5 mark and the $78.4 mark.

Chart Courtesy: Benzinga Pro

On Wednesday, Rio’s ASX-listed stock in Australia closed 1.66% higher.

Read Next: Michael ‘Big Short’ Burry Questions What Strategy Will Pull Americans Out Of Recession: ‘…There Are None’

 



Image and article originally from www.benzinga.com. Read the original article here.