View Full Version : Easy money ,20% or more

07-25-2002, 06:54 PM
This is the trade.CPN is the stock.If you like

to gamble just buy the stock outright.It will be

over 10 perhaps 15 in two years.They will net

1.44 per share this year according to analysts.I believe the number will be closer to 1.20. CPN closed at 4.05 today up .25 Here is the boring but easy money trade.They have a good product.They sell electricity.They own over a trillion cubic feet of gas and they have the most modern gas burning turbines on the planet.They are actually endorsed by the Sierra Club.They own

Geothermal wells also.They have been audited twice in the last few months and are clean as a whistle.

Buy 1 Jan2004 7.50 put 5.20

Sell 2 Jan2004 5.00 puts at 3.10 or better

You collect 100.00 per spread.

Margin is at most 250.00 but the most you can lose on the trade is 150.00

Here is how it works.

At expiry if CPN is over 7.50 you collect the credit of 100.00

at 7.00 you make 150.00

at 6.00 250.00

at 5.00 350.00

at 4.00 250.00

at 3.00 150.00

at 2.00 50.00

Worst case you are long 100 shares for each spread at 1.50

These are some other possibilities.CPN is a takeover candidate and the stock rallies sharply,

you reverse your ratio backspreads for a credit.

Your return on risked money will be over 100%

I took all the money I had in CD's and put them in these trades.

BTW I have been selling every rally in the S&P futures since March.Still room on the downside

but this trade is a must do.

07-26-2002, 12:34 PM
nice thinking..i might bite,,,thanks...gl

07-27-2002, 02:57 AM
FWIW, Schwab rates CPN an 'F' (on an A to F declining scale) which means they think it will strongly underperform the market in the next 12 months.

07-27-2002, 11:48 PM
that would tend to make me take a second look at it.

07-28-2002, 06:09 AM
yeah its a definite plus. a lot of analyst, brokerage, and money manager gibberish at this point.

07-28-2002, 07:29 AM