Playing Defense With L-3 Options

That defense stocks would rally as the U.S. embarked on the war against terrorism was a given. The real question now taking shape is whether investors will stay positive on them throughout what's sure to be a long, drawn-out campaign.

Even the dogmatic behavior of investors during most defense-stock rallies may not be enough to offset the market's other key themes of disappointment and underperformance (or at least suspicion of such) when it comes to L-3 Communications (LLL Quote), which began to surrender some ground this week.

Waning Enthusiasm

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