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Speaking on
Bloomberg Markets, Jim Strugger of MKM Holdings revealed his options trading strategy for
Yahoo! Inc.YHOO ahead of earnings.
He likes
Yahoo! Inc. and he thinks that possible catalysts for a move higher are the stake in
Alibaba Group Holding LtdBABA and the restructuring that is going to take place.
Strugger said that the options market is implying a 7 percent move on earnings and he expects to see a larger move after the event. To make a bullish bet he wants to buy the March 30 call options, which were trading around $1.55 at the end of the session on Wednesday. The break even for the trade is at $31.55 or 9.62 percent higher from
Yahoo! Inc.'s closing price.
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