In my column last week, I showed you how to use straddle options to take advantage of market/stock volatility when the direction is uncertain. This week, we hop over the fence to the straddle’s sister strategy - the strangle options play.

To refresh your memory, a straddle is when you essentially bet on both sides of a trade by using options that have the same strike price and same expiration date.

For example, if you like Bank of America (NYSE: BAC), currently trading around $12, you could buy a $12 call option and a $12 put option. In doing so, the goal is that once the stock moves in a particular direction, one option will move high enough that it offsets the loss from the other one - and more.

With a strangle option, the basic goal is exactly the same, but the trading strategy is slightly different. Here’s how it works…

Reasons

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Every time the United States goes through a recession, the pundits all race to be the first to proclaim that “Buy and Hold” is dead.  I can’t watch a financial news channel or read a financial website without some mention of this proclamation.  Well I’m growing tired of it, and if it were up to me, I’d prohibit anyone else from making this point for the rest of 2009.

Buy and Hold is not dead, and I’m on a mission to prove it.  Buy and Hold has worked brilliantly for decades, and it will continue to do so in the future.  The stock you bought in 2007 is worth less now than what you bought it for?  Oh boohoo, go cry me a river…somewhere else.  The economy has peaks and troughs, and we’re in the middle of one of the more serious

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Con Edison Announces 2009 Earnings GuidanceConsolidated Edison (ED) announced that it expects 2009 earnings per share from ongoing operations to be within the range of $3.00 to $3.20 per share.The new 2009 earnings guidance considers the effects of the recently approved Consolidated Edison Company of New York electric rate order, including the company's plan with respect to austerity measures that the rate order directed the company to file with the New York State Public Service Commission.In addition, for 2009, the company now expects to spend approximately $2.3 billion for capital investments, virtually all of which will be spent at the company's regulated utilities.The diversified utility holding company also expects to issue common stock of between $150 million and $400 million in addition to stock issuances under the company's dividend reinvestment and employee stock plans. This is a decrease from the ...

More than a third of the year has passed and the markets have rebounded nicely from their lows to turn a small profit on the year.  It seems that the worst may be behind us when it comes to equity prices as many stocks have rallied more than 50% this year alone.  Here at Bullish Bankers we published a “Best Stocks of 2009″ newsletter at the beginning of the year, and our equities have performed very admirably when compared to our benchmark, the S&P 500.  This article is designed to give a recap of how our equities have performed and give some additional explanation to our initial stock picking process.  Through Friday, May 8th, our BB2009 Index has outperformed the S&P 500 by 11.51% on a geometric basis ex-dividend payments.  Beside each of the sectors I have listed our three picks and the comparable ETF to show our relative performance

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More than a third of the year has passed and the markets have rebounded nicely from their lows to turn a small profit on the year.  It seems that the worst may be behind us when it comes to equity prices as many stocks have rallied more than 50% this year alone.  Here at Bullish Bankers we published a “Best Stocks of 2009″ newsletter at the beginning of the year, and our equities have performed very admirably when compared to our benchmark, the S&P 500.  This article is designed to give a recap of how our equities have performed and give some additional explanation to our initial stock picking process.  Through Friday, May 8th, our BB2009 Index has outperformed the S&P 500 by 11.51% on a geometric basis ex-dividend payments.  Beside each of the sectors I have listed our three picks and the comparable ETF to show our relative performance

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For Immediate Release

Chicago, IL - May 5, 2009 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Palm (PALM), Hartford Financial Services Group, Inc. (HIG), Callidus Software, Inc. (CALD), Consolidated Edison (ED) and Washington Post Company (WPO).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=4579.

Here are highlights from Monday's Analyst Blog:

PALM: Hype & A Hot Stock

One of this year's hottest stocks has been Palm (PALM). Yes, the Palm that made PDA famous.

Last fall, shares of the company could have purchased for about $1.50 per share. On Friday,

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      As the fallout in the financial markets continues to unwind, a number of companies have bolted down balance sheets and insured some cash flows by cutting their once attractive dividends.  In the past month we have seen the likes of General Electric [GE: 10.32, +0.32 (+3.20%)], JP Morgan Chase [JPM: 27.11, +1.97 (+7.84%)], Bank of America [BAC: 7.67, +1.40 (+22.33%)], Pfizer [PFE: 14.25, -0.01 (-0.07%)] and Alcoa [AA: 5.48, -0.11 (-1.97%)] all cut these coveted yields, proving that this trend has extended into and beyond the financial sector.  However, one sector that has maintained their healthy yields has been the utilities sector.  While equity prices in the sector have been beaten down with the overall market, there is still a basket of companies that have the means to continue redistributing lucrative cash flows to investors.  By no means are

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Consolidated Edison (ED) Reports Earnings for Fiscal Year 2008

Consolidated Edison (ED) reported earnings for the 4th quarter and fiscal year ended December 31, 2008. In the reported quarter, net income was $160 million or $0.58 per share (basic and diluted), compared with $207 million or $0.76 per share (basic and diluted) for the 4th quarter of 2007.

Excluding a gain on the sale of Con Edison Development’s generation projects, discontinued operations and net mark-to-market effects of competitive energy businesses, earnings from continuing operations during the reported quarter came to $200 million or $0.72 a share, compared with $191 million or $0.71 a share in the year-ago quarter.

Operating revenue in fiscal 2008 increased marginally to $13.6 billion from $13.1 billion in fiscal 2007. For the full year 2008, the company reported earnings of $1.2 billion, or $4.38 (basic) and $4.37 (diluted) per share, compared to earnings of $929 million, or $3.49

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It’s clear that 2009 is going to be grim in economic terms. Martin Denholm says investors should stick to sectors that fare better during recessions. The healthcare sector, discount retailers and utilities companies provide essential products and generate repeat business. Martin picks the strongest companies in these “safe haven” sectors.

This from Smart Profits Report

A Healthcare Haven

It stands to reason that the sectors and companies that traditionally fare better during economic recessions are those that garner essential repeat business.

As my colleague Marc Lichtenfeld has pointed out many times here before, that includes the healthcare and biotech sectors. And far from procrastinating, Marc just issued his “Five Predictions For The Healthcare Sector In 2009″ for Xcelerated Profits Report subscribers in the January issue. If you’re not a subscriber, you should be! You can get more information on that here.

No matter what happens with the broader economy, people will still

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New York City-based Consolidated Edison, Inc., a.k.a. ConEd (ED) is a diversified utility holding company with subsidiaries engaged in both regulated and unregulated businesses. Stable regulated utility operations, gains from the sale of generation projects, a reasonably strong balance sheet, strong cash flow, regulated rate increases and earnings from non-regulated businesses collectively make Consolidated Edison a conservative income-based investment story. ED offers an above-industry average dividend yield, competitive with Treasury yields. However, the issues of future electricity sales growth, rising cost structure, and increasing capital expenditure continue to restrain valuation. Accordingly, with a mixed outlook, we maintain our market-neutral HOLD recommendation on ED common stock with a six-month target price of $43.00. Price appreciation to our near-term valuation target, coupled with the recently increased $0.585 per share quarterly dividend which appears sustainable assuming modest projected EPS growth represents annualized total return potential of 12.5%....