Weighing the Options at Wal-Mart

I ... I'm going to have with Barron's thank the men were to come to the toughest part of the Barron's part of successful investing conference ... I am here without a meal ... Hatchett is the CEO and C I will be point couple manage and should ... bring us ... Xstrata did a little easy on us ... no um ... everyone Sunoco what they can do about positioning for the fiscal cliff and things like that ... could you talk about ... um being long the dollar ... versus the euro ... um and using the FX ... um can you tell us who thought that ... there's ... only three major points ... I'm sad to consider here when you ... think about the direction of the year over the next two or three months ... one is the fact that in the U S it's all about growth and government achieve growth and certainly both sides of the aisle have ... an opinion on and she go but there's really very little ... discussion about doing crafts ... and then in Europe it's really about ... um what status of their recovery there and it's it's safe to say at this point I think that the crisis days ... as all the tax ... on deposit elections and stay in Spain over the weekend ... it's it's partly about that that standards will come to pass for ... four more ... bond buying program and the ECB ... um but the third point is that growth in Europe ... um is this survey from Iraq ... and the conditions to be part of the city's bond buying program ... are are are such that they believe are proclivity much more austere in nature ... so ... one of us ... that growth differential between the U S and Europe is is is certainly going into the U S until four basis ... that's the reason why the euro goes down it's the dollar basically like the dollar versus the euro um and you know which mean if if if something with it all wrong with the fiscal cliff the ... dollar would do well because the facts ... an added benefit of a ... just just speaking any ... um any sort of systemic risk tends to favor the dark over to do with the XT which is the exchange to us yet we think we think generally speaking within the FXE ... output spreads make sense ... that said I respect but in sentencing sign of our strength but apparently they got the gender expiration ... and the one twenty seven one twenty two put spread ... okay ... now of course all the talk about the ... trade involving Wal-Mart which is this common people hold ... um would you think about what was ... which lead to a woman in a Wal Mart's penetrated ... stock it's been attracted to people because of its divinity oh yes ... Wal-Mart also benefited from ... some of the the the the man of transfer payments to come ... into the system whereby im Wal-Mart started customer ... has more money to spend at the store and things like food and energy ... costs ... um and it's also benefited certainly been too much market they're much smaller degree rather ... um it's benefited from improvement in and things like employment and housing and in ... the broader stock market is well ... um ... adults were basis ... unbeknown ... although we continue to like owning Walmart we think it's time to take the edge instead of a vet some upside call them against the euro ... um that that that situation and three scenarios one when the market goes law or to be happy so I call this the market goes sideways happy ... because well of him and says the Open survey of the market is harder ... to get back to back row third man ... that's because you're experiencing better growth and estimate Wal-Mart boss attractive yet says that's a cave in and we're expect Wal-Mart to underperform in that area so so would you be selling out the money call it money all in all four of which is ... that's right so attentive to Jamie expiration about one quarter ... and did so slightly out of money call option ... on this particular case um this second half strike call out to dinner it ... was nice to know it will ends the book that you do that in the stock that's right okay mom it's not possible veto by Hollande young people increasingly want our ... country cooks and they spend the money on so ... Apple things are doubtful he'll buying a portable device that leads people to everything that they care about ... which do without warning that using options yet think the key here is this is ... is the ... question is is the long-term ... secular trend and an apple still alive and well so we absolutely ... agree with that ... and in the near term ... Apple's ... im sure it is a next downward movement and tech stocks given ... Europe's Week reporting ... earnings reports last ... week or so ... that's given the opportunities on Apple um but there's no guarantee that Apple's an estoppel ... or will the couple from proper tax which is for the ... global growth story ... even even if you think it should ... I'm so sick a much more Cerberus suggested approach to the Amman Apple through ... starting really smart with three with respect to the potential release ... I've that many ... earnings in the twenty fifth ... the more we don't call spreads in Apple and what that does is it really limits your down side of the new face of a call spread ... but still gives you ... understand this correctly ... instead of holding Apple shares which you know it's it's a pretty rich stop you you ... you would ... on a call spread ... in the replacement with the posters that's right so I intended to governments are Apple shares of Lamar ... by the ... January six hundred and forty five I call it and simultaneously sell the January sixteen ninety five strike all that sort of a target price from the upper end if you will ... cost about fifteen dollars an ounce of the thing about the maximum profit gained thirty five the risk and fifteen in a thirty five roughly ... two to one of ... the very quick question if we have time to ask too little and ... financials which is you know the variable sector there's a lot going on what would you to using them options to manage the risk of volatility in financial ... it was really the parents to appear in time for the next quarter and am looking out in a two or three months ... were we think Dom volatility in that sector ... um will will remain subdued and into the sector most would find its footing ... um it's it's ... well it's benefited from really cute we want to eat into the three with respect to assets on balance sheets and proving ... it allowed banks to improve things like the tier one capital ratio ... to come into the market but can see Citigroup's earnings ... they're in a position now ... I'm too young to buy back additional shares of stock or substantially ... increase the dividend yield ... those sorts of things and the ... destabilizing factors ... for financials ... the other thing is that the ashes of benefited from this improving consumer credit quality and excellent housing improves and you can modest improvements in employment ... and that sort of thing ... it's also in the school was used as a proxy for the sector would like to sell up to ... the excellent ETF and I ... think at this point ... makes a lot of sense for folks in them ... to take advantage of Apple which has a lower amount of volatility given their valuations as well as the bubble room for upside ... aam is to own excellent right okay ... and simultaneously sell ... a put and call covered strangle ... around at some of the position if I remember my options correctly ... you into selling about one to call him out of output ... the new holding huge yet that that that that that spread to ten minutes ago everybody began with an extra two or three months ... to January selling the generous sixties right but ... and simultaneously signed a generous seventeenth recall ... all the while monopoly in the next chair ... and what that does is as if the stock is Lauren you to buy more shares to choose to do that that that's what it is about ninety cents so ... the buy additional shares at fifteen ten ... and if the underlying morality because out of stock it up in seventeen ninety which is something of a ... steep ... slope to think about thank you very much thanks for everything thank you ...