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Healthy Profits in Diagnostics?

Tuesday, 17 Aug 2010 | 8:18 PM ET

All this week, we're finding you the fast money in the future in medicine, including how diagnostics can mean big money and big danger.

From MRIs to CT scans, nearly 100 million such tests are performed each year. The tests are used to find hard-to-detect dangers, but now some are worried about the possible radiation these machines may emit. Others fear overexposure. In turn, doctors are asking how they can make the best of modern technology while still obeying their promise to 'first do no harm'?

Healthy Profits: Medican Scan Trade
The hot stock picks in tech scanning.

Karen Finerman, president and co-founder of Metropolitan Capital Advisors, said Becton, Dickinson and Company devotes a small part of their business to answering that question.

Guy Adami, managing director at Drakon Capital, likes BDX. He notes that it's trading at 9 times forward earnings. Adami thinks the stock is pretty interesting at current levels. It stopped at $66 a share and has since rallied, but still thinks it's worth a trade.

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HEDGE FUNDS' "HERD MENTALITY"?

Are hedge funds crowding the same trades, asked CNBC's Melissa Lee on Tuesday's "Fast Money". Here's what this week's 13F filings reveal about their "herd mentality":

  • Citigroup : John Paulson, Bill Ackman, Burce Berkowitz and George Soros
  • Goldman Sachs : John Paulson, John Griffin and Bruce Berkowitz
  • Pfizer : David Einhorn, John Paulson and John Griffin
  • SPDR Gold Shares exchange-traded fund : John Paulson, George Soros and Steve Mandel
Hedge Funds Crowding the Same Trades?
A look through some crowded trades, with Anthony Scaramucci, SkyBridge Capital.

Joe Terranova, chief market strategist at Vitrus Investment Partners, is long each of these positions. In the first three names, he has already seen the worst. He can't say that about GLD, but said you have to own gold given current economic conditions.

Anthony Scaramucci of Skybridge Capital and author of "Goodbye Gordon Gekko" said hedge funds have gotten gigantic, so they're going with big, liquid names that have low P/E and potential upside biases.

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10-YEAR BONDS TO TRADE UNDER 1%?

You Thought Your Rates Were Low?
Insight on the 10-year Japanese government bond yield hitting a 7-year low, with Tim Seymour, Trading the Globe host.

Some said we'd never see 2.5% on the 10-year Treasury bond, but we're almost there. In Japan, the 10-year bonds are trading at under 1%, so is that where we're headed, asked CNBC's Melissa Lee.

Deflation is not going to send our bonds lower, said Tim Seymour of EmergingMoney.com. Look at Tuesday's PPI numbers, for example, where we're up 4.2%. US bond yields are low for fiscal reasons, Seymour said. Japan's problems are serious, but they're not our problems, he added.



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Trader disclosures for Tuesday, Aug. 17, 2010:

Joe Terranova
Terranova owns (AKAM)
Terranova owns (V)
Terranova owns (NRG)
Terranova owns (POT)
Terranova owns (OXY)
Terranova owns (GLD)
Terranova owns (BAX)
Terranova owns (MOS)
Terranova owns (PFE)
Terranova owns (SU)
Terranova owns (XBI)
Terranova owns (GOOG)
Terranova owns (LRCX)
Terranova owns (AXP)
Terranova owns (C)
Terranova owns (GS)
Terranova owns (BMO)
Terranova owns (MSFT)
Terranova owns (QCOM)
Terranova owns (FCX)
Terranova owns (APA)
Terranova owns (GLD) Calls
Terranova is chief market strategist of Virtus Investment Partners, LTD.

Virtus Investment Partners own more than 1% of (ABAX)
Virtus Investment Partners own more than 1% of (ALK)
Virtus Investment Partners own more than 1% of (AMKR)
Virtus Investment Partners own more than 1% of (CASS)
Virtus Investment Partners own more than 1% of (CSVI)
Virtus Investment Partners own more than 1% of (XLY)
Virtus Investment Partners own more than 1% of (XLP)
Virtus Investment Partners own more than 1% of (DRYS)
Virtus Investment Partners own more than 1% of (EXR)
Virtus Investment Partners own more than 1% of (XLI)
Virtus Investment Partners own more than 1% of (IGE)
Virtus Investment Partners own more than 1% of (LDR)
Virtus Investment Partners own more than 1% of (LPHI)
Virtus Investment Partners own more than 1% of (XLB)
Virtus Investment Partners own more than 1% of (MGRC)
Virtus Investment Partners own more than 1% of (NRCI)
Virtus Investment Partners own more than 1% of (DBV)
Virtus Investment Partners own more than 1% of (SUBK)
Virtus Investment Partners own more than 1% of (XLK)
Virtus Investment Partners own more than 1% of (XLU)
Virtus Investment Partners own more than 1% of (WDFC)
Virtus Investment Partners own more than 1% of (YDNT)

Guy Adami
Adami owns (AGU)
Adami owns (BTU)
Adami owns (NUE)
Adami owns (C)
Adami owns (GS)
Adami owns (INTC)
Adami owns (MSFT)
Adami’s wife works at Merck

Karen Finerman
Finerman’s firm owns (AAPL)
Finerman’s firm is short (ANF)
Finerman’s firm owns (ARG) calls
Finerman’s firm owns (BBY)
Finerman’s firm owns (GENZ) options
Finerman owns (GOOG)
Finerman’s firm owns (JCG)
Finerman and Finerman’s firm owns (JPM)
Finerman’s firm owns (RIMM)
Finerman’s firm owns (TJX)
Finerman’s firm owns (WMT)
Finerman's firm is short (IJR)
Finerman's firm is short (MDY)
Finerman's firm is short (SPY)
Finerman's firm is short (IWM)
Finerman’s firm owns S&P 500 puts
Finerman’s firm owns Russell 2000 puts

Gary Kaminsky
***No Disclosures***

Patty Edwards
Edwards owns (AMZN) for clients
Edwards owns (C) for clients
Edwards owns (CSCO) for clients
Edwards owns (F) for clients
Edwards owns (GE) for clients
Edwards owns (GLD) for clients
Edwards owns (GOOG) for clients
Edwards owns (HD) for clients
Edwards owns (JCG) for clients
Edwards owns (MSFT) for clients
Edwards owns (PFE) for clients
Edwards owns (TTM) for clients
Edwards owns (WMT) for clients
Edwards owns (YHOO) for clients
Edwards owns (TM)

Tim Seymour
Seymour owns (POT)

Barry Ritholtz
Funds managed by Ritholtz own (PCS)
Funds managed by Ritholtz own (QID)
Funds managed by Ritholtz own (TLAB)
Funds managed by Ritholtz own (SBGI)

Anthony Scaramucci
Scaramucci and SkyBridge Capital are long (MSFT)

Colin Gillis
***No Disclosures***

Stephen Weiss
***No Disclosures***

Scott Nations
***No Disclosures***

  Price   Change %Change
BDX
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C
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GLD
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GS
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PFE
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  • Melissa Lee is the host of CNBC's “Fast Money” and “Options Action.”

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  • Guy Adami is a contributor on CNBC's "Fast Money." He also is managing director of stockMONSTER.com.

  • Najarian, the "Pit Boss," is cofounder of optionMONSTER.com, a news site for options traders.

  • Finerman is president of Metropolitan Capital Advisors, Inc., a company she co-founded.

  • Founder of EmergingMoney.com

  • Chief Market Strategist for Virtus Investment Partners & CNBC Contributor

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