Monday, May 21, 2012

Buying Into the Euro Panic using LEAPs

The following chart looks pretty ugly - Eurostox50 index has been getting sold off relentlessly.  However in all market panics, a contrarian play often accompanies great risk reward characteristics.

The way to capture this trade is to take a long term view of Europe solving their mess by December 2018 which is the expiry on the LEAPs CALL options ESTX50 @ 331.