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Trade of the Day: Aetna Inc (AET)

Ken Trester

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In general, the market is kind of in a wait-and-see environment, as we are still making our way through earnings season, digesting geopolitical developments in North Korea and Saudi Arabia, anticipating another potential interest-rate hike by the Federal Reserve in December and waiting on a tax-reform bill to get passed.

Meanwhile, there is a bullish theme I’ve got my eye on: the potential takeover of Aetna Inc (NYSE:AET) by CVS Health Corp (NYSE:CVS).

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The deal would make CVS more like a medical center at the same time as it’s operating its drug stores. I thought that was a great idea, and so I’m recommending this option trade to profit from the situation:

Buy to open the AET Jan (2018) 195 Calls (AET180119C00195000) at $1.85 or lower.

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