Playing Small Ball

Is it Tuesday? Check. Are the equity markets green? Check. All is right with the world. The economic data are light this week, even if words from the Fed are not. It's light on the earnings front too, but I have an interest in trading some smaller names before and after the reports, although on a small scale.

Diana Shipping (DSX) Source: StockCharts.com View Chart » View in New Window »

First up is Diana Shipping (DSX), which used to be a momentum traders dream along with several other shippers. If you remember those days, then you also remember what a red Tuesday looks like, but I digress. There is a good amount of call buying today. I can see why, with the stock having successfully tested support it looks ready to power higher. This hasn't been a huge mover around earnings, but the potential is there. The short-term downside may be capped around $10, but I do want to play the upside as well. I am buying a July 11 call and shorting a June 12 call for a diagonal call spread. Then I am buying 1x July 10 put and shorting 2x June $10 puts. The total cost here is around $0.50 with my targets being around $10 or pushing up towards $12....190 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

Read the full story and get access to the Real Money Pro trading floor.

There’s no substitute for a trading floor to get great ideas, so Jim Cramer created a better one at Real Money and blogs there exclusively. We then added legendary hedge fund manager, Doug Kass, with his exclusive Daily Diary and best investing ideas. Staffed with more than 4 dozen investing pros, money managers, journalists and analysts, Real Money Pro gives you a flood of opinions, analysis and actionable trading advice found nowhere else, and allows you to interact directly with each expert.

Already a Subscriber? Please login.

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.