David Baskin
NYSE Group
NYX-N
DON'T BUY
Jul 27, 2006
When it went public, there was a lot of excitement about stock exchanges around the world. A classic case of hype overcoming substance. Could never understand why it was over $60. A recession or slower growth in the US will result in fewer listings and trading will decline.
You buy this at $33.70, Sell the NYX January $35 Call at $2.85 and Sell the NYX January $30 Puts at $2.50. If the stock declines, you could average in to the position over the next 9 months. You are obligated to either buy at $30 or sell at $35.
Exchanges are wonderful proxies for the economies they serve. Looks like it’s on the mend. If it could get through the $31 level, $50 is a possible target.
(Market Call Minute.) Is the European deal dead? Looks like it will have difficulty getting through. Don’t Buy as you don’t know if the deal is going to go through.
Doesn’t own any exchanges. This one in particular has had some challenges in terms of growth. Decent dividend yield. Stock trading volumes have generally been declining over the last number of years and he doesn’t see many ways to reverse this.