Liz here, with all the details on how I nearly killed myself – twice – the night before my wedding. I even got a specially made certificate to commemorate it because, in the words of the company hosting the event, “no one has ever done this to us before.”
BEFORE I get into all that, though, let’s grab triple digits….
Your DECK calls are up 106%, last I checked. Fluff yeah, Garrett! We’re not too far from the Nov. 19 expiration date, so go ahead and close those out for a nice profit this afternoon.
You’ve now taken home at least three wins in two days. I hope you’ll pay attention to me NOW. (I am just like my four-year-old, it’s sobering.)
So anyway, the bachelorette party was a murder mystery dinner, hosted at a nice bar, and organized by Rachelle, my maid of honor and Tom Gentile’s right-hand woman. Very nice, very classy. I am nothing if not classy (please ignore the occasional fish porn). (Editor’s note: Don’t forget the taxidermy, Liz.)
Probably because I am the bride, the hosts took me aside at the beginning and told me that I was cast to be the evening’s victim. I was supposed to take a sip of my drink and die “convincingly.”
Boy, did I ever! I walked back to my seat, gagged on my Chardonnay, and fell backwards. The entire chair went back with me. I cracked my head on the table corner. Everything went black for a slight moment.
I woke to a ring of concerned faces. “We thought you were really dead,” said one of the nice host ladies. “But…you weren’t supposed to die YET.”
Oops. Apparently, there was a whole rigmarole they had yet to go through with switching the water glasses of the guests. THEN I was supposed to die.
So, I died a second time. Somehow, the chair went backwards yet again. This time, I did not black out, but I visibly wounded my elbow at a spot that can be seen in my wedding photos. (Behold.)
I am COMMITTED TO THE PART. Bodes well for the marriage, I suppose!
ANYWAY, now that you’re fully primed for excitement, let’s dive in and make some money on that sexy, murderous, glamorous entity, the Lexington Realty Trust (LXP). Here’s what to do.
First, Pick Up 100% on DECK…
This’ll be short and sweet, like a very brief near-death experience.
|Action to Take:
SELL-to-CLOSE DECK Nov 19 $400 Calls (DECK211119C00400000)
Thanks, Garrett! (By the way, you’ve now made money on both of the recommendations from “Fluff Yeah” – first the Nickel Slots NKE calls, and now Dollar Slots on DECK. Way to milk the ugly shoe industry for all it’s worth.)
And Then Set Yourself Up for, We’ll Say, Triple Digits on LXP
Full disclosure: CJ, who tipped me off to today’s recommendation, was a little under the weather. He sent me some brief notes (thanks, CJ, I love you, though I can no longer legally marry you!) but he didn’t tell me exactly how much percent gain he expected. We’ll just go hog-wild and say 100%. Tip that chair right on back.
LXP is a mortgage REIT that “owns a diversified real estate portfolio of equity and debt investments in single-tenant commercial properties across the U.S.,” according to REIT.com. What did I tell you?! GLAMOROUS.
“LXP stock was flat into earnings, as the Fed and interest rates have been putting a little pressure on the REITs,” CJ said, beginning his brief notes before relapsing into his bed of illness.
If you want the INCREDIBLY SEXY AND MURDEROUS explanation of this… the Fed is likely to raise interest rates just a bit (a quarter point!) starting in 2022. (Somewhere, Marty Fartman is yelling loudly about this, though thank goodness he’s no longer yelling at me.)
This thought makes mortgage REITS like LXP sad, because higher interest rates mean REITS will have to pay more for their debt. Owning debt is the main way REITS make money, because – in case you also didn’t know this – REITS are contractually obligated to distribute 90% of their taxable income as dividends. If they do THIS, they don’t have to pay corporate taxes themselves.
In all honestly, it’s just a big, convoluted scheme to avoid the IRS. We’ve all been there. (Whoops, did I say that out loud.)
ANYWAY, LXP, like most REITS, is a little depressed right now at the thought that – horrors! – the Fed will raise rates by a quarter-point.
But, in CJ’s words, “That consolidation puts LXP into a short-term volatility play with a break above $15 doing two things…. triggering a bullish volatility event while also triggering a short-covering squeeze.
“14 days to cover and as a kicker, the short to float is 10%. I don’t need both, but when I get them I like it.
“I’m targeting a $16.50 print on the stock over the short-term.”
I made a very nerdy joke here which, like REITS, I am contractually obligated to report. I said, “I’m very interested in this play. Short interest, that is.” (Editor’s Note: Mark Sebastian would be proud.)
CJ’s got two ways to play this. I’m torn on how to classify them, actually! First, he just wants us to buy the stock, which I’d normally put as Nickel Slots. But then his options – which I’d usually put in there as Dollar Slots – are so darn cheap! You can’t beat $0.75 a contract.
I honestly think I’m just going to have to put both of these in there as Nickel Slots. Nickel One and Nickel Two. Thing One and Thing Two, like Dr. Seuss.
There’s Thing One:
Action to Take:
Buy LXP shares at $15 or less.
And then here’s your leverage play, for Thing Two:
Action to Take:
BUY-to-OPEN LXP Feb 18, 2022 $15 Calls for no more than $0.75 per contract.
Enter as a Good-til-Canceled (GTC) order.
That’s all for now, folks! I’ll be back tomorrow with possibly, a new play from the mysterious Nick Black, or possibly, one from our international man of mystery, AK. The suspense is killing me. Twice.