Investors Looking For Upside Should Consider Buying Out-Of-The-Money Call Options In The Powershares QQQ

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October 14, 2009 12:38pm NASDAQ:QQQ NASDAQ:QQQQ

etf-news7Investors looking for upside should consider buying out-of-the-money call options in the Powershares QQQ fund an exchange-traded fund tracking the Nasdaq 100 index or the S&P 500 index, said Goldman Sachs derivative strategists. “We like owning


 November options to cover earnings season,” they said in a report on views on U.S. Index Volatility. They suggest buying the November $45 strike QQQQ calls which were recently offered at 29 cents, 20.1 volatility and 20 delta. “Our scenario analysis shows a 2.2 to 1 payout by the end of October if the index is up 5 percent, they said. They also recommended November 1125 strike SPX calls: recently offered at $7.9; 18.3 volatility; 21 delta. Goldman’s scenario analysis shows 2.6 to 1 payout by the end of October if the SPX is up 5 percent, the note said. Reuters Messaging: [email protected] 1041 ET 14Oct2009-About one-qtr in survey think Wall St yet to hit bottom

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