Alan Knuckman's Sears Trade

Speaking on "Bloomberg Markets," Alan Knuckman of ‎Bulls Eye Option suggested a bullish options strategy in Sears Holdings Corp SHLD.

He wants to sell the June 7 put for $0.40. If the stock stays above $7 at the June expiration, he is going to collect $0.40. If it drops below $7, he is going to have to buy the stock at $7 — but it would actually cost him $6.60. The trade starts to lose money below $6.60. Knuckman added that with this strategy, investors have a chance to buy the stock they like 15 percent below the current stock price.