Play EXQ Calls
Plus, Maintain VMW Sell
Dear Bottarelli Research Member,
In September of 2006, the Chicago Board Options Exchange announced the launch of the CBOE Exchange Index (EXQ). This powerful index takes all of the publicly-traded exchanges and baskets them together in one investing vehicle — offering you tremendous exposure to companies like CBOT Holdings (BOT – NYSE), Chicago Mercantile Exchange (CME – NYSE), Intercontinental Exchange (ICE – NYSE), International Securities Exchange (ISE – NYSE), NASDAQ Stock Market (NDAQ – NASDAQ) and NYSE Group (NYX – NYSE), all in one easy to follow basket!
If you’ve followed my alerts in the past, then you know that I’m incredibly bullish on every one of the publicly-traded exchanges listed above, and that’s why I find the EXQ so appealing. You can own upside exposure to every one of these companies all in the same basket!
Now, given the explosion of ETF’s on the market today, not many investors are even aware that the EXQ exists. Therefore, the EXQ options string is very thinly traded. Nevertheless, the EXQ chart looks attractive at current levels, and the reduced trading volumes mean that the December call options are quite cheap. Not only that, but there has been rampant market speculation that a takeover (or acquisition) will occur between one or two of the exchange names listed above. If something is announced (or speculation of a pending takeover is leaked), the entire sector could blast higher — and we’ll be the proud owners of the entire group. Therefore, I’d like to initiate a trade that we “set and forget” for the next few weeks via December EXQ calls. If you make this trade, plan to hold it throughout the Thanksgiving holiday and into next week.
PLAY: Buy the EXQ December 150 Calls (EXQ LJ) at or under $5.70, good for the day. Current bid/ask spread is $5.00 to $5.40. Place a protective stop limit at $2.20.
Also, continue to work your $6.00 sell order on the VMware December 90 Calls (VMW LR).If this $6.00 price does not trigger today, then maintain this order good for the week. And continue to hold the Apple December 175 Calls (APV LO) for more upside as well. And as always…
Lock and load!
Sincerely,
© 2012 CSR Group, LLC. All rights reserved. Published in USA.
Information, opinion, research, and commentary contained herein is obtained from sources believed to be reliable; their reliability, however, cannot be guaranteed. The maxim of Caveat Emptor applies — let the buyer beware. Bottarelli Research does not provide individual investment advice, act as an investment advisor, or individually advocate the purchase or sale of any security or investment.
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