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The Obama Trade: Expanded Use Of Drones

Tuesday, 30 Mar 2010 | 5:50 PM ET

As you may have heard, President Obama recently made a surprise trip to Afghanistan to visit the troops.

In the wake of health care reform, pundits say Obama may may now look for progress in other areas - especially this one -- the war against terror.

By deciding in December to order a massive buildup to the war he inherited, Obama placed a big bet and escalated an unpopular war that has seen few gains in its eight years. By the end of this summer, U.S. forces are expected to near 100,000, roughly three times as when Obama won the White House.

The Aerospace Defense Trade
The trade against terror.

But ironically his weapon of choice in fighting the war there does not involve the troops. It involves drones.

Every day about 20 predator drones patrol the skies of Afghanistan; 250 bombs fired against enemies such as Al-Qaeda have been fired from drones.

Considering the future of military may be in these unmanned fliers, how should you trade the aerospace/defense space?

Honeywell makes electronics system for the drones, explains Guy Adami. They’re a great name. But may favorite in the space is L3 .

I’d play the suppliers such as BE Aerospace or Rockwell Collins, says Joe Terranova.

As a second derivative play I’m a buyer of Flir Systems, says Karen Finerman.

I like RTI and ATI , says Tim Seymour. And if you’re looking for an overseas trade, look at Embraer , he adds.



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Trader disclosure: On March 30th, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Najarian Owns (IPI) Call Spread; Najarian Owns (MRVL); Najarian Owns (CLF) Call Spread; Najarian Owns (YUM) Call Spread; Najarian Owns (DOW) Call Spread; Finerman's Firm Is Short (IYR), (IWM), (SPY), (MDY); Finerman's Firm Is Long S&P Puts; Finerman Owns (AAPL); Finerman's Firm Owns (BAC), (BAC) Preferred; Finerman Owns (BAC), (BAC) Leaps; Finerman's Firm Owns (FLIR); Finerman Owns (GOOG); Finerman's Firm And Finerman Own (GGP); Finerman's Firm Owns (NOK), (OSIP); Finerman's Firm And Finerman Own (WFC); Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Terranova Is Short (EL); Terranova Is Short (GS); Terranova Is Short (CAL); Terranova Is Short (UAUA); Terranova Is Long May 2010 Crude Oil Futures; Cortes Is Short Euro; Cortes Is Short Treasuries; Cortes Owns (IWM), (IBB) vs. Short S&P; Edwards Owns (TM), (UUP)

For Joe Terranova
Terranova Works For (VRTS)
Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (GOK)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLV)
Virtus Investment Partners Owns More Than 1% Of (XLI)

For Patty Edwards
Edwards Owns (AAPL) For Clients
Edwards Owns (BA) For Clients
Edwards Owns (BAC) For Clients
Edwards Owns (C) For Clients
Edwards Owns (F) For Clients
Edwards Owns (GLD) For Clients
Edwards Owns (PGM) For Clients
Edwards Owns (GS) For Clients
Edwards Owns (GOOG) For Clients
Edwards Owns (MMM) For Clients
Edwards Owns (MOT) For Clients
Edwards Owns (MS) For Clients
Edwards Owns (MSFT) For Clients
Edwards Owns (NFLX) For Clients
Edwards Owns (NOK) For Clients
Edwards Owns (QQQQ) For Clients
Edwards Owns (RIMM) For Clients
Edwards Owns (SPY) For Clients
Edwards Owns (T) For Clients
Edwards Owns (TM) For Clients
Edwards Owns (VWSTX) For Clients
Edwards Owns (VWLTX) For Clients
Edwards Owns (VZ) For Clients
Edwards Owns (WFC) For Clients
For Heath Terry
FBR Capital Markets Is a Market Maker Or Liquidity Provider For (NFLX)

For Pip Coburn
Coburn Is A Partner In Buckeye Delta Fund
Buckeye Delta Fund Owns (AAPL)
Buckeye Delta Fund Owns (GOOG)
Buckeye Delta Fund Owns (RIMM)
Buckeye Delta Fund Is Short (MOT)
Buckeye Delta Fund Is Short (YHOO)
Buckeye Delta Fund Is Short (NOK)



CNBC.com with wires

  Price   Change %Change
ATI
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BEAV
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COL
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EMBR
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FLIR
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HON
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LLL
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RTI
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  • Chief Market Strategist for Virtus Investment Partners & CNBC Contributor

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