Add PCP Puts

Add New Downside Protection

By Bryan Bottarelli
Friday, February 29, 2008 11:28 AM EST
Fri, 29 Feb 2008 16:28:00 GMT

PLAY: Buy the PCP March 110 Puts (PCP OB) at or under $3.80, good for the day.

Dear Bottarelli Research Member,

After locking in a nice gain on our BEN March 95 Puts, I’d like to re-establish another downside put position in our trading ledger. This new put will come in the form of Precision Castparts (PCP – NYSE).

PCP

PCP manufactures metal components the aerospace, power generation, general industrial, and automotive markets, and as you can see from the chart below, the stock has had a very tough time breaking past the $120 level. Based on this inability to extend past $120, it now looks like the bears will take PCP shares back down to $105 and possibly $100 before finding the next support level. To profit off this fall, let’s add the PCP March 110 puts to our ledger now!

PLAY: Buy the PCP March 110 Puts (PCP OB) at or under $3.80, good for the day. Execute a sniper sell if these puts trade up to $4.50 per contract, and place a protective stop limit at $2.10.

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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