A Quick Lock & Load

Add RIMM Puts

By Bryan Bottarelli
Monday, October 02, 2006 3:07 PM EST
Mon, 2 Oct 2006 20:07:00 GMT

Dear Bottarelli Research Member,

I don’t have time for “small-talk” on this one, but we have an opportunity for some quick downside profits on Research in Motion (RIMM – NASDAQ). As you probably know, the Blackberry maker just experienced a massive one-day jump, taking the stock from $86 up to $104.

RIMM

I find this rather ironic because one day before this huge jump, RIMM came up on my screen as a potential overbought candidate. I elected to wait on recommending puts until after their earnings announcement — which proved to be a great decision. But now that the big jump is over, I think you’ll witness some profit-taking on RIMM which could peel another $5 to $10 off the over-extended stock price. Therefore, for all you quick-hit speculators, I’d like to add some RIMM puts to our ledger for a lock and load trade.

PLAY: Buy the RIMM November 100 Puts (RUP WE) at or under $5.10, good for the day. Current bid/ask spread is $4.80 to $4.90. Place a protective stop loss at $3.10.

Lock and load

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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