Gersh's Option trades Message Board

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Strategies & Market Trends : Gersh's Option trades

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To: Mark Johnson who wrote (625)	11/20/2007 11:20:32 PM
From: Mark Johnson	Read Replies (1) of 652

Looks like FNM is in some serious doo doo. I don't see the stock or the sector hitting the upside anytime soon. Good news for the call option shorters. I like the idea of shorting the FNM December 45 calls, bidding around 25 cents, asking 35 cents. If FNM goes up into the $37 to $40 area (stock is at about $28 right now), I would consider the idea of then covering that short, then shorting call options at a higher strike price. I would expect some short covering in the stock, not sure of when or how high it will go when that happens. On a scale of 1 to 10 with 10 being the best, I would rate this one an 8. Too many uncertainties will keep a lid on the upside in my opinion. Good luck option shorters.

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