A Speculative WB Put Play

Add October 5 Puts

By Bryan Bottarelli
Monday, September 15, 2008 2:45 PM EDT
Mon, 15 Sep 2008 18:45:00 GMT

PLAY: Buy the WB October 5 Puts (WB VQ) at or under $0.75, good for the day. Place a protective stop limit at $0.25 and a pre-determined sniper sell at $2.00

Dear Bottarelli Research Member,

On three prior occasions, we’ve played put options on shares of Wachovia (WB – NYSE). These put plays were based on my thinking that WB’s home-equity lines of credit could soon put the entire company at risk, following in the line of other troubled financial institutions. As you cans see from today’s WB chart, Wall Street might finally be on the same page with me.

WB

In fact, if today’s financial selling pressure extends into tomorrow and Wednesday, shares of WB could soon find themselves around the same levels as Washington Mutual (WM – NYSE) under $3.00 per share. Therefore, I’d like to enter into a speculative “blood and guts” play on WB, which positions us to profit if shares get decimated due to panic selling pressure.

Specifically, let’s go ahead and enter the WB October 5 Puts (WB VQ) at or under $0.75, good for the day. These puts are a pure speculation that shares of WB will aggressively sell off, which could increase their value at a very high rate. Therefore, let’s go ahead and carefully add them to our ledger now!

PLAY: Buy the WB October 5 Puts (WB VQ) at or under $0.75, good for the day. Place a protective stop limit at $0.25 and a pre-determined sniper sell at $2.00.

And as always…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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