I've narrowed down the list to those stocks with a rolling one-year correlation within the range +/- 0.05. So far so good, and what's interesting is that nearly all of these are stocks that you've heard of before and have probably even traded, names like Nike ( NKE), Delta ( DAL), and Google ( GOOG).
Trades: Buy to open AMZN November 240 calls for $12.70 and sell to open AMZN November 255 calls for $6.60.
Note that I'm comfortable adding bullish exposure to AMZN because we already have bearish-facing positions in our portfolio (on China, the Australian dollar, Annaly Capital Management ( NLY), etc. - all previous OP trades). If Amazon breaks down dramatically or some fundamental change occurs, I could be convinced to dump the position, but otherwise I think it's smart to stick with such a clear market leader.
On Wednesday, October 19 at 6:00 p.m. EDT, TheStreet's Options Profits is hosting a webinar featuring Fred Ruffy of WhatsTrading.com. Join Fred as he outlines how to look at the "big picture", drill down into the sectors and ultimately find the individual options trade. Utilizing specific trade examples and case studies, Fred will show you how to select simple and advanced options plays. The back half of the webinar will include an interactive, exciting Q&A session.
Please email: firstname.lastname@example.org to secure a slot for the webinar as space is limited and for the link to the presentation. IF you have already RSVPd, there is NO NEED to send another reposnce. A spot has been reserved.
Click here for a 14-day free trial to Options Profits
OptionsProfits can be followed on Twitter at twitter.com/OptionsProfits