Trade of the Day: Vodaphone (VOD)

Despite the broader market’s sag Tuesday, big-cap new highs were very defensive, led by Unilever (NYSE:UN), General Mills (NYSE:GIS), Kellogg (NYSE:K) and Con-Agra (NYSE:CAG), though a couple of more aggressive stocks that crept into the list were resurgent fast food giant Yum Brands (NYSE:YUM) and British mobile chip maker ARM Holdings (NASDAQ:ARMH).

Another big British name, a company with a whopping $123 billion market capital, stands out for me now as a bullish bet. Vodaphone (NYSE:VOD), the UK-based telecommunications provider, pulled back during the past four months to the $25 level where it has found firm footing in the past year.

It has bounced off this level by $2.50 to $5.00 in December 2011, March 2012 and June 2012.  I suspect we will see this again, so take advantage of the seasonal strength.

Buy the VOD Jan 25 Calls at 75 cents with a limit order.

So why VOD and not competitors in the space like Telef (NYSE:TEF) or SK Telecom (NYSE:SKM)?

The calls for VOD are very, very cheap, which leaves a bigger profit margin for you.

Jon Markman operates the investment firm Markman Capital Insight. He also writes a daily swing trading newsletter, Trader’s Advantage.  Try Trader’s Advantage today and save 50%.