DIA $109.75 THE DOW WILL PLAY CATCH UP TOP THE DAX
-DAX down 25% ytd and 33% from the April highs
-INDU down only 5% ytd and 14% from April highs….
Many of the 30 Dow components receive at-least 10% of their revenues from Europe coupled with the Dollars recent rally vs the Euro this could make profits tough to come by in Europe for a while.
( 16 names get more than 25% of their revenues from Europe, and another 8 get atleast 10%) Tech pharma and consumer most exposed….. with IBM, HPQ, JNJ PFE, UTX KFT and MCD all in mid 20s.)
DIA BUY OCT 105/100/95 Put Fly for .50
Buy 1 Oct 105 Put for 3.35
Sell 2 Oct 100 Puts for a total of 4.20 (2.10 each)
Buy 1 Oct 95 Put for 1.35
Break-Even on Oct Exp:
Profits: btwn 104.50 and 100 make up to 4.50, at 100 make full 4.50, btwn 100 and 95.50 profit trails off.
Loses: above 105 and below 95 lose .50, btwn 104.50 and 105 lose up to .50 and btwn 95.50 and 95 lose up to .50
OR A MORE SIMPLE VERTICAL WITH A 4 TO 1 PAYOUT POTENTIAL…
TRADE 2: DIA $109.35 BUY OCT 105 / 95 Put Sprea for 2.00
-Buy Oct 105 put for 3.50