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Options Action: Interest Rates

There's a great deal of confusion in the mortgage market these days. Rates right now refuse to budge from 50-year lows.

Yet the threat of inflation has many calling for a second half spike. It could mean the difference between a mansion and a Mcmansion.

But Brian Stutland says you have options, --literally.

He suggests hedging your interest rate risk with a long position in the TLT . His trade follows:

Buy Dec 93 call for $5.40.

Learn more about this trade. Watch the video now!




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Trader disclosure: On June 3, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Kelly Owns (STD) Calls; Kelly Owns (IBM) Calls; Kelly Owns (NBG) Calls; Najarian Owns (C) Calls; Najarian Owns (HK) Call Spread; Najarian Owns (JEC) Call Spread; Najarian Owns (LCC) Calls Spread; Najarian Owns (NOVL) Calls; Najarian Owns (SD) Call Spread; Terranova Owns (RIG), (RSX), (TER), (AXP), (BMO), (BBY), (DIS), (XCO), (IPSU), (SWN), (AAPL), (APA), (UPL), (CVS), (IPI), (TEVA), (FXB), (GLD)

For JoeTerranova
Terranova Works For (VRTS)
Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.
Virtus Investment Partners Owns More Than 1% Of (AMKR)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (DBV)
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 (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (XLU)
Virtus Investment Partners Owns More Than 1% Of (DRYS)
Virtus Investment Partners Owns More Than 1% Of (ALK)
Virtus Investment Partners Owns More Than 1% Of (XLK)

For Brian Kelly
Kanundrum Capital Owns (APA)
Kanundrum Capital Owns (IBN)
Kanundrum Capital Owns (FCX)
Kanundrum Capital Owns (FXE)
Kanundrum Capital Owns (JOYG)
Kanundrum Capital Owns (TLT)
Kanundrum Capital Owns (GLD)
Kanundrum Capital Owns (STD)
Kanundrum Capital Owns (NBG)
Kanundrum Capital Owns (IBM)

For Brian Stutland
Stutland Equities Is A Market Maker In VIX And SPX Futures And Options
Stutland Equities Is A Market Maker In VXX Options
Stutland Is Long U.S. Treasuries

For Paul Sankey
(XOM), (CVX), (MUR), (HES), (MRO), (VLO) Is An Investment Banking Client Of Deutsche Bank Securities
Deutsche Bank And/Or Affiliate(s) Has Received Non-Investment Banking Compensation From (XOM), (CVX), (MUR), (HES), (MRO), (VLO) In Past Year
(XOM), (CVX), (HES), (MRO), (VLO) Has Been A Client Of Deutsche Bank Securities In Past Year (Non-Investment Banking Securities-Related Services)
Deutsche Bank And/Or Affiliates Owns 1% Or More Of (MUR), (HES), (MRO), (VLO)

For Deborah Weinswig
An Employee Of Citigroup Global Markets Is A Trustee Of (TGT)
An Employee Of Citigorup Owns (WMT)
An Employee Of Citigroup Owns (JCP)
Citigroup Global Markets Or Affiliates Owns 1% Or More Of (SKS)
Citigroup Global Markets Or Affiliates Has Managed Or Co-Managed Offering Of (DG), (KR), (WMT) In Past 12 Months
Citigroup Global Markets Or Affiliates Has Received Investment Banking
Compensation For Services Provided In Past 12 Months From (DG), (KR),(SKS), (SVU), (TGT), (WMT)
Citigroup Global Markets Expects To Receive/Seek Investment Banking Compensation From (WMT) In Next 3 Months
Citigroup Global Markets Or Affiliate Received Non-Investment Banking Compensation From (HD), (JCP), (KSS), (KR), (M), (SWY), (SVU), (TGT), (WAG), (WMT), (COST) In Past 12 Months
(DG), (KR), (SKS), (SVU), (TGT), (WMT) Are Or In Past 12 Months Were Investment Banking Clients Of Citigroup Global Markets
(CVS), (DG), (HD), (JCP), (KSS), (KR), (M), (SWY), (SKS), (SVU), (TGT), (WAG), (WMT), (COST) Are Or In Past 12 Months Were Clients Of Citigroup Global Markets (Non-Investment Banking, Securities-Related Services)
(HD), (JCP), (KSS), (KR), (M), (SWY), (SVU), (TGT), (WAG), (WMT), (COST) Are Or In Past 12 Months Were Clients Of Citigroup Global Markets (Non-Investment-Banking, Non-Securities-Related Services)
Citigroup Global Markets Or Affiliate Received Compensation From (DG) In Past 12 Months
Citigroup Global Markets Is A Market Maker In (CVS), (M), (COST)
Citigroup Global Markets And/Or Affiliates Has A Significant Financial Interest In Relation To (HD), (JCP), (KR), (LOW), (M), (JWN), (SWY), (SVU), (TGT), (WMT), (COST)
Citigroup Global Markets Or Affiliates Owns 5% Or More Of (SKS)

For Charles Biderman
Biderman Is Short (CRM)
Biderman Is Short (AAPL)
Biderman Owns Gold
Biderman Owns TIPS


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