Option Investor
Newsletter

Additional MCM June 2008 recommendations 6-1-08

HAVING TROUBLE PRINTING?
Printer friendly version

We are adding the following credit spreads to our June 2008 recommended list

We are recommending credit spreads in the following issues:


MAR - Marriott International, Inc. operates and franchises hotels under the Marriott, JW Marriott, The Ritz-Carlton, Renaissance, Residence Inn, Courtyard, TownePlace Suites, Fairfield Inn, SpringHill Suites and Ramada International brand names; develops and operates vacation ownership resorts under the Marriott Vacation Club International, Horizons, The Ritz-Carlton Club and Marriott Grand Residence Club brands; operates Marriott Executive Apartments; provides furnished corporate housing through its Marriott ExecuStay division; and operates conference centers.







Commentary:

Travel and discretionary spending go hand in hand. even if you believe business affairs will have to continue as "usual". Employers are going to look for discounts and deals at accommadations with escalating gas prices. Fewer extended business trips. Bottom line hotels and lodging will suffer until this economy finds a way to get out of its own way.

==============================================================

AXP - American Express Company is primarily engaged in the business of providing travel related services, financial advisory services and international banking services throughout the world. American Express Travel Related Services Company, Inc. provides a variety of products and services, including, global network services, the American Express Card, the Optima Card and other consumer and corporate lending products, stored value products, and several others.




Commentary:

The financials still have an uphill fight and I still believe there are a few more surprises left to be sprung upon us before we see the light. AXP may be darling "GREEN", but its cardholders have the same inherent problem that everyday Americans have....Too many expenses, rising food and energy costs and too little money, of the discretionary kind to handle the expenses.

============================================================

UYG - ULTRA FINANCIALS PROSHARES (UYG)




Commentary:

You already know how I feel about the banks, take a look at the BKX position we currently have. The banks have a lot to prove to me. I am still waiting for their final disclosure regarding this credit crisis. Maybe it is forth coming, but not this month.

=============================================================

We are recommending the following specific credit spreads


Equity Portfolio:

MAR $32.91

BUY MAR-FU MAR JUN $37.50 CALL DEBIT = $0.10
SELL MAR-FG MAR JUN $35.00 CALL CREDIT= $0.30
NET CREDIT = $0.20

INITIAL "NET- CREDIT TARGET= $0.20 or $20.00
POTENTIAL PROFIT (x 10 CONTRACTS @ $0.20 = $200.00
MARGIN REQUIRE. (x 10 CONTRACTS $2,300.00
RETURN ON INVESTMENT= 8.70%

EXIT STRATEGY = 1. WATCH LIST 2. MAXIMUM LOSS SPREAD PRICE DIFFERENCE
1. STOCK WILL BE PLACED ON WATCH LIST IF STOCK PRICE RISES TO: $33.50
2. ON SPREADS WITH 2.50 or less difference in STRIKE PRICES
THOSE POSITIONS. THEY WILL GO ON THE WATCH LIST AND BE FOLLOWED WITH INSTRUCTIONS AS TO HOW TO PROCEED OR/WHAT EXIT POINT NEEDS TO BE ESTABLISHED

` AXP $46.35

BUY AXP-FX AXP JUN $52.50 CALL DEBIT = $0.15
SELL AXP-FJ AXP JUN $50.00 CALL CREDIT= $0.35
NET CREDIT = $0.20

INITIAL "NET- CREDIT TARGET= $0.20 or $20.00
POTENTIAL PROFIT (x 10 CONTRACTS @ $0.20 = $200.00
MARGIN REQUIRE. (x 10 CONTRACTS $2,300.00
RETURN ON INVESTMENT= 8.70%

EXIT STRATEGY = 1. WATCH LIST 2. MAXIMUM LOSS SPREAD PRICE DIFFERENCE
1. STOCK WILL BE PLACED ON WATCH LIST IF STOCK PRICE RISES TO: $48.50
2. ON SPREADS WITH 2.50 or less difference in STRIKE PRICES
THOSE POSITIONS. THEY WILL GO ON THE WATCH LIST AND BE FOLLOWED WITH INSTRUCTIONS AS TO HOW TO PROCEED OR/WHAT EXIT POINT NEEDS TO BE ESTABLISHED


Index Portfolio:

UYG $29.62

BUY UYG-FG UYG JUN $35.00 CALL DEBIT = $0.30
SELL UYG-FW UYG JUN $32.00 CALL CREDIT= $0.55
NET CREDIT = $0.25

INITIAL "NET- CREDIT TARGET= $0.25 or $25.00
POTENTIAL PROFIT (x 10 CONTRACTS @ $0.25 = $250.00
MARGIN REQUIRE. (x 10 CONTRACTS $2,750.00
RETURN ON INVESTMENT= 9.09%

EXIT STRATEGY = 1. WATCH LIST 2. MAXIMUM LOSS SPREAD PRICE DIFFERENCE
1. STOCK WILL BE PLACED ON WATCH LIST IF STOCK PRICE RISES TO: $30.75
2. ON SPREADS WITH 2.50 or less difference in STRIKE PRICES
THOSE POSITIONS. THEY WILL GO ON THE WATCH LIST AND BE FOLLOWED WITH INSTRUCTIONS AS TO HOW TO PROCEED OR/WHAT EXIT POINT NEEDS TO BE ESTABLISHED

INDEX OPTIONS, ETFS AND HOLDER ISSUES:
In ADDITION IF WE ARE USING A INDEX OR HOLDER OPTION WE WILL RECOMMEND WHEN A STOP SHOULD BE ADDED, IF THAT TIME BECOMES NECESSARY




Orders to purchase or sell securities through your account with optionsXpress, Inc., an independent registered broker-dealer ("optionsXpress"), shall be accepted and executed solely by optionsXpress, subject to the terms and conditions of your individual account agreement with optionsXpress. optionsXpress makes no investment recommendations and does not provide financial, tax or legal advice. All inquiries regarding your optionsXpress account, including any disputes or trading errors, should be directed to optionsXpress. Option Investor, Inc is not a registered broker-dealer and is not in the business of transacting trades. Furthermore, Option Investor, Inc is not a registered investment adviser, does not provide financial, tax or legal advice, and is not recommending that you buy or sell any particular security. optionsXpress has made its services available to you via Option Investor, Inc as a courtesy. optionsXpress and Option Investor, Inc are separate and unrelated entities. optionsXpress is not affiliated with and does not endorse or warrant the products or services of Option Investor, Inc.

Monthly Cash Machine Newsletter Archives