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Current DateTime: 10:12:29 23 Nov 2009
LinksList Documentid: 30328029

CNBC Stock Blog

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Jun.30
4:17 PM ET
Monday, 30 Jun 2008
Options Action: Make $$$ on Financials

Making money from options: Stacey Gilbert of Susquehanna Capital Group and Jon Najarian of OptionMonster.com offered CNBC their strategies.

Where has the options action been? "We've seen flows in retail stocks," said Gilbert. "But in terms of vaulation and sentiment," she's "less comfortable" recommending retail.

Recomendations:

Gilbert says there is a strategy for investors who are long stock, naming Citigroup [C  Loading...      ()   ] specifically. She says it only works for investors who don't expect the financial giant to have "a pop," but rather a "long grind."

"The market is implying a 35 percent probability that Citi is below $15 by the September expiration," said Gilbert. "If you disagree, you can" play put spreads.

Najarian thinks investors should generally avoid being long financials -- except for Washington Mutual [WM  Loading...      ()   ]. "I am long this name," he says. "It's one of the first financials" where he's seen "very strong buying activity."

But the OptionMonster.com founder -- and Fast Money guest -- has another favorite:

"One of the best trades an investor could make is one of the double-short ETFs, like the SDS [UltraShort S&P 500 ProShares] [SDS  Loading...      ()   ]."

Disclosures:

Disclosure information was not immediately available for either Gilbert, Najarian or their firms.

Disclaimer

© 2009 CNBC.com

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