mike khouw kick us off. >> the april 90 calls are a way to make a move on exxon. >> i like that as well. mike is getting long volatility. >> dan nathan. >> cat i'm going to look out and make a short-term bearish bet. >> our time expired. i'm melissa lee. >> for more "options action" go to options action cnbc.com. see you next friday. meantime, "money in motion" is up after this break.

>> mike khouw you got an answer?connecticut, also home of mark twain. >> nice. >> nice job there. >> there's nobody that lives there. >> there are tweets. >> here comes the hate mail. >> in comparison to yum, where is starbucks in their expansion into china? >> they are -- let's put it in baseball terms. they're in the bottom of the first inning. i mean, starbucks is really relative to yum who's going to open up 456 stores this year. >> what inning is yum in? >> i think yum is somewhere in kind of the top of the seventh. there's plenty of room for them to go. there's a lot of competition. i think again for them it's about margins and about their like for like sales. which they showed continue to be strong. that's why the stock is trading at a valuation that implies they're in the fourth request inning. but i don't think they are. >> @my names joe paul is this is a good entry point for nsc? >> no. we've been on the rails. we've been talk about long into earnings. then pulling the rip cord. that turned out to be right.

mike khouw. >> there's still time to hedge.ould. >> joe. >> start thinking about the iphone 5, mobile payments. mxpi. >> if apple has become too big a position in your portfolio, pair it back. >> karen. >> i like staples. >> pete. >> love the big cap names. intel you can still own it. >> thanks for watching. i'll see you tomorrow 9:00 a.m. for "squawk on the street." back tomorrow at 5:00 for "fast money" on

mike khouw, what you got? >> cvi emergency.ld the stock, with icahn supporting the stock a bit by suggesting there might be some buyers and on the top end keeping it range bound, if you own you might look to sell calls against it. i was looking at the june 30s. that will collect 7.5% or so on a stand still basis. and you still have some upside if some buyer were to emerge. >> catch more "options action" every friday at 5:00. >>> much more "fast money" coming up next. we're answering your tweets. stay unto do. [ male announcer ] technology accelerates at a relentless pace. anything not moving forward... is moving backward. [ tires screech ] [ engine turns over, tires squeal ] introducing the 2013 gs, with the lexus enform app suite -- the most connected information and communication technology available in an automobile. [ engine revs ] the all-new 2013 lexus gs. there's no going back. see your lexus dealer. tspark card from capital one... spark cash gives me the most rewards of any small business credit card. it's hard for my c

. >> mike khouw, at what point do you get concerned about where crude oil is and gasoline? a year ago in march we saw crude oil around where we're seeing it now. in that period, stocks and crude did move higher for about a month afterwards. >> yeah, well, you know it's interesting. there have been times in the past when rising crude oil prices will be expected to coincide with a rising equity. there was a lot of concern about risk assets generally. that isn't what troubles me here though. i think the implications of higher crude prices on consumers can depress the economy slightly. really we're seeing higher crude prices because of political risk. and that can create a downside shock. the fact that gold prices are higher could be a potential implication of the commodity markets there's increased relation risk. all things can spell disaster. >> mike makes a good point. historically the relationship has been crude moves higher because of a stronger economy and the stock market moves higher. this time it may be different because the highs are made on lower volumes, declining h

mike khouw. >> own some mgm, you might look at the june 15 calls.ut 80 cents or 5.8% of the current stock price if you sell those calls against your stock. >> on the japanese yen. continuing to ease aggressively. stock market's up, the yen's got to come down. >> love jesse j. she reminds me of that woman on that mark harmon show. >> poor man's katy perry. >> i like bill

. >> mike khouw, i'm curious. i would imagine once we heard some details about the new ipad 3 between the processer, the 4glte that the options picked up. >> the options activity has been pretty extraordinary for some time. karen is right. april options expire on the 21st which is a saturday and of course the earnings come on the 20th. that's probably a good one to sell. i think it's interesting when we take a look at those stocks everyone was talking about having outperformed. a lot of those were highly distressed names that had farther to climb. i think to look at a stock like apple which has no debt and has grown its way out, that's a different story than looking at the auto associated names. or cummins which is an industrial name. those came because if you believed in the downturn b with it would be challenged. i don't know that apple hasn't outperformed them if you take a step back from that. >> dan on the show yesterday mentioned the fear about running for the exits on something like apple. what happens to t

that's what mike khouw and carter would do. thought it was running away. >> nike's overbought too far, too fast. but shorting nike? >> no, no, no. >> you said it, mars. so the put for $2.25. now to make money mike needs nike's stock to go below that. $2.25? is there a way to do this for less? >> sell the 90s against it. >> well done. so to spend less, mike then sole the april 90 strike put for 90 cents and created his put spread. but he did something even better. he made making money easier and here's how. between the $2.25 he spent buying one put and the 90 cents he collected selling the other, he cut his cost to just a buck 35. now instead of needing nike to fall below $97.95, he will see profits if it's below $98.65 by expiration. of course there's a tradeoff. and the strike of the put that he sold. good thing he did cut his costs because since the time of the trade, nike shares have continued to run. now they must make a choice. stay long the trade and hope nike stumbles or get out. and "options action" all want to know one

go to mike khouw who's got a trade on the material sector. mike?he i thithings to at here to take edge off, materials up probably 10% if you're looking at the xlb. look putting on a put spread collar. the one i was looking at was the june put spread call. sell the 31s against it. i'm going to have a net debit of 25 cents to ensure myself to $31 but still maintain up to 40 bucks which giving 9.5%. a 30 cent dividend between now and then. that can be used to help finance this trade as well. really if you're holding on to your xlb, you're not going to lay anything out. you're still going to collect. >> thanks for that. more "options action" every friday at 5:00. next on "fast," my exclusive interview with michael coors on how his business is changing. more "fast" coming up next. people with a machine. what ? customers didn't like it. so why do banks do it ? hello ? hello ?! if your bank doesn't let you talk to a real person 24/7, you need an ally. hello ? ally bank. no nonsense. just people sense. ♪ where the sun never goes out ♪ ♪ and the sky is deep

ttd#: 1-800-345-2550 >>> final trade, mike khouw?actical bets on low value stocks like hewlett. >> tim see more? >> love free port, do it through march calls. >> guy? >> why are they playing this music? macy's, letter m. >> hammer. >> looking for dividend just in case, m.o. >> keith mccullough. >> short hapes brands, awful quarter today. i'm melissa lee. back at 5:00 for "options action" followed by "money in motion" at 5:30 eastern time. don't go anywhere, jim has a trifecta of

mike khouw, you like this stock? >> they've been buying upside calls.nk when thing to do with the valuation here. sell some at the money or out of the money calls here. they're well bid. you'll collect 10%. >> 10%, not bad. thanks for that. go t to take a break. up next we're translating roche and illumina's war of words. and there's a major hedge fund who thinks so. we're tracking unusual activity in the stock. more "fast money" up next. [ ma] the two trains and a bus to the 5:00 arider.holar. the "i'll sleep when it's done" academic. for 80 years, we've been inspired by you. and we've been honored to walk with you to help you get where you want to be. ♪ because your moment is now. let nothing stand in your way. learn more at keller.edu. >>> welcome back to "fast money." the board of illumina rejected roche's $5.7 billion bid to take over the company calling the r grossly inadequate. what happens next? karen's got the fine print. you were in this trade. that's your perspective. >> i am. you have to read through what they're saying and what it really me

mike khouw is looking at whirlpool. of the biggest winners in the s&p 500 today off its guidance. >> i think when they came out with a positive surprise here it really gave a quick boost to the stock. i still think that some of the longer term headwinds this company faces could obviously put some pressure on any further gains. so one of the things you might look to do if you're fortunate enough to ride it up here is have calls against it. you could collect about 4.5 bucks for those. i do think the stock fell off towards the close. that would yield about 7% until maturity or 17% if you analyze that. if you did sell it that's above the average analyst price target. though i do expect some of those targets to rise based on today's earnings. >> you were in whirlpool. now you're looking to short whirlpool. >> yes. i agree with mike's point here. we were long whirlpool. we got out short of the stock. i think it goes a lot lower. the 7% looks like a great trade. but i think whirlpool set the bar too high for themselves here. w