Wednesday Morning Movers: AMZN, CREE, SCSS >>> READ MORE

3 Call Contenders: Insurance Stocks

Take advantage of these bullish trends with calls or an outright buy


As I was using my Power Stocks scanning program to take a look at the market, insurance stocks caught my attention. Several names in this area had all of the qualities I look for in a call option—the potential for a big move up (volatility) based on technicals and past activity in the stock, and good liquidity. All of these are names you’ll recognize, and for good reason—options which do not have liquidity may trap you into a position, or prevent you from taking a large enough position to make the transaction worthwhile.

I’ll leave it up to you to decide which strike price and month are appropriate for your trading style, but be sure to give yourself enough time to be right. I’ve also included the support and volatility levels my scanner has detected for these stocks. An average volatility is considered to be 20.

  • Aetna (AET) closed Friday at $60.38, or 3% above its support at $58. The stock shows fairly average volatility at 25 so I wouldn’t expect any terribly wild moves.
  • American International Group (AIG) is showing a reestablished buy pattern in which it has confirmed its upward trend after a temporary pullback. Such a bounceback is one of the most reliable buy signals. With the uptrend already starting (AIG is about $2 above its $42 support), make sure you either buy or try at-the-money calls to take advantage of additional upside.
  • Cigna (CI) shows the same pattern of a reestablished buy, and similarly average volatility to the other insurance stocks. This is not a group known for its volatility. Currently trading at $67.90, CI is sitting right at its support, which could indicate a great entry price

InvestorPlace advisor Ken Trester has launched Power Options Weekly. This brand new weekly service delivers 5 new trades to you each Friday. It’s the perfect ‘bridge’ between investing in ordinary stocks and the turbocharged world of options trading. Trester has been trading options since the first exchanges opened in 1973 with a winning streak that goes back to 1984 with money-doubling average annual profits since 1990. Try Power Options Weekly today and receive 2 weeks for the price of 1 for only $19.95.


Article printed from InvestorPlace Media,

©2017 InvestorPlace Media, LLC