In his 'Master Trading' portfolio, Bernie Schaeffer uses fundamental, technical and sentiment metrics to select trades. Here's a trio of ideas from Schaeffer's Investment Research.
"I have initiated a long position in Office Depot (NYSE: ODP). Price action for ODP has been strong, with the equity gaining more than 108% year-to-date.
"Recently, the equity pulled back to its 20-day moving average. There is heavy out-of-the-money put open interest for ODP. An unwinding of the short positions related to this open interest could provide a tailwind for the stock.
"In addition, upgrades are a possibility for ODP, as none of the 12 analysts covering the stock rate it a 'buy.'
"I have also initiated a long position in Brunswick Corp. (NYSE: BC). The stock has been a strong performer in 2009, gaining more than 146% year-to-date.
"The equity pulled back last week to support from its 20-day moving average. Despite the strong price action, short-sellers continue to target BC, as more than 12% of the stock's float is sold short.
"A continued rise in the stock's price could spark a short-covering rally. Upgrades are a possibility for BC, as only 1 of the 7 analysts covering the stock rates it a 'buy.'
"I have also initiated long position in Lennar Corp. (NYSE: LEN). Price action for LEN has been strong, with the equity gaining more than 90% year-to-date. This morning, the stock pulled back to possible support from its 20-day moving average.
"Short interest for LEN is high, with more than 13% of the stock's float sold short. A continued move higher by the shares could spark a short-covering rally. Upgrades are a possibility for LEN, as only 3 of the 10 analysts covering the stock rate it a 'buy'."
