I Had this Cool Idea

A New Report: 5 Speculative (and Cheap) Doublers

By Bryan Bottarelli
Friday, July 28, 2006 11:44 AM EST
Fri, 28 Jul 2006 16:44:00 GMT

Dear Bottarelli Research Member,

Earlier this week, I pointed out a cheap upside call option on Merck (MRK – NYSE). It was two days ago, on July 26th, where I wrote that the MRK January 45 Calls (MRK AI) could be a nice speculative play for only $0.45 per contract. I calculated that if Merck moved up just $2.50 over the next six months, you could have a straight double on these calls – which made it a speculation worth taking.

Although it wasn’t an official recommendation, I’ve been following this position over the last few days. And right now, the MRK January 45 Calls (MRK AI) are now trading for $1.05. That’s a 133% gain in just two days! (Note: If you did make this play, take your profits!)

MRK

Based on this move, I had an idea for a new special report. I’d like to isolate a handful of stocks in strong 6-month up-trends or strong 6-month down-trends, and use this prevailing trend to discover cheap, out-of-the-money calls (or puts) that carry into January of 2007. If I can find, for example, five $0.45 options like I did for Merck, you can pay a total of $2.25 to own all five positions. And if these stocks continue to move as suggested by their established trend-lines, I think all five could eventually double!

I would call the report something like “5 Speculative (and Cheap) Doublers” and I’d make the recommendations good over the longer-term, similar to what I did with the picks from the “Aftermath Report.” Given how this latest Merck play performed, I think this could be a valuable addition to our daily trades.

Next week, I plan to begin my due diligence on this special report. And unlike other newsletter services, which aim to charge hundreds of dollars for this type of research, I will be giving this report to you — free of charge. In my book, it’s already included in the total benefit package of being a Charter Member to BottarelliResearch. So stay tuned for this new report — which could probably be available towards the end of August. As you can probably tell, the sweet taste of the Merck play has gotten my interest, so I’ll look to uncover similar opportunities like this for you moving forward.

In other news, today’s 126-point gain on the Dow is certainly very impressive. If things continue, the blue chip average looks to finish off a very strong week — proving good upside momentum for our plays on CAT, ABX, and CSX.Over on the put side, I like the fact that GRMN is up only fractionally today, which supports the underlying bearishness that’s taken hold of the stock.

Next week, we’ll start an exciting new week of trading. Until then…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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