GO
Loading...

Options Action: Limited

With shares of Limited trading bewteen $23 and $27 over the past 30 days, how should you game the stock ahead of its next earnings release?

Mike Khouw of Cantor Fitzgerald expects the stock will remain range bound and therefore suggests a calendar spread. His trade follows:

Limited (LTD) -- July
Sell 26 Calls @ $1.00

Limited (LTD) -- August
Buy 26 Calls @ $1.60

How Mike's Trade Makes Money
Profits above $26.60 by August expiration

* Find out more about this trade as well as what Mike Khouw has to say about DeVry and Starwood. Watch the video now!




______________________________________________________
Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to fastmoney@cnbc.com.

Trader disclosure: On June 14, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Seymour owns (AAPL); Edwards owns (PM); Adami owns (AGU), (BTU), (NUE), (C), (GS), (INTC), (MSFT); Adami’s wife works at Merck; Finerman’s firm own (AAPL); Finerman owns (AAPL); Finerman’s firm owns (BBY); Finerman owns (BBY); Finerman’s firm owns (BP) calls; Finerman owns (GLW); Finerman’s firm owns (HPQ); Finerman owns (HPQ); Fienrman owns (RIG) calls; Finerman’s firm is short (IJR); Finerman’s firm is short (MOY); Finerman’s firm is short (SPY); Finerman’s firm is short (IWM); Terranova owns (IPSU), (BX), (PFE), (GMCR), (RSX), (TER), (AXP), (BMO), (BBY), (DIS), (XCO), (SWN), (GLD), (AAPL), (IPI), (SU), (V), (TEVA); Terranova owns UK Pounds; Terranova owns Euros; Terranova is short the US Dollar

For Tim Seymour
Seygem owns (MTL)

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 (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 (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)

Patty Edwards
Edwards owns (HES) for clients
Edwards owns (XOM) for clients
Edwards owns (RIG) for clients
Edwards owns (NE) for clients
Edwards owns (SLB) for clients
Edwards owns (HAL) for clients
Edwards owns (WFT) for clients
Edwards owns (DO) for clients
Edwards owns (GLW) for clients
Edwards owns (BBY) for clients
Edwards owns (CVS) for clients
Edwards owns (V) for clients
Edwards owns (AKAM) for clients
Edwards owns (AAPL) for clients
Edwards owns (DELL) for clients
Edwards owns (HPQ) for clients
Edwards owns (INTC) for clients
Edwards owns (TXN) for clients
Edwards owns (NVDA) for clients
Edwards owns (STM) for clients
Edwards owns (CSCO) for clients
Edwards owns (SPY) for clients
Edwards owns (QQQQ) for clients
Edwards owns (PM) for clients

Dennis Gartman
Funds Managed By Dennis Gartman Are Short Yen
Funds Managed By Dennis Gartman Are Long Canadian Dollar, Australian Dollar

Mike Khouw
Cantor Fitzgerald makes a market in (HOT)

Jon Najarian
Jon Najarian owns (NYX) and seats on the exchange
Jon Najarian owns (CME) and seats on the exchange
Jon Najarian owns (CBOE) and seats on the exchange

Ed Mills
***No Disclosures***

Darren Horowitz
Raymond James & Associates received non-securities-related compensation from (EPD) within the past 12 months.
Raymond James & Associates received non-securities-related compensation from (PAA) within the past 12 months.



CNBC.com with wires

Symbol
Price
 
Change
%Change
DV
---
HOT
---
LB
---

Contact Fast Money

  • Showtimes

    Halftime Report - Weekdays 12p ET
    Fast Money - Weekdays 5p ET

Halftime Report