Mike Khouw's SPDR S&P 500 ETF Trust Trade

On CNBC's "Options Action", Mike Khouw suggested that investors should consider a contrarian bet in SPDR S&P 500 ETF Trust SPY.

Khouw wants to buy the November 285 call for $3. The trade breaks even at $288 or approximately 3.5 percent higher. He bought these calls on Wednesday before the market closed and he thinks this is a rather inexpensive way to get a bullish position because you have to pay around 1 percent of the stock price to get long.