McDonald’s (MCD, $57.24, up $0.09) has gone on sale again. I may be a little early in saying this but I’ve been telling you that we are going bargain hunting. I know it may be hard to “go long” in a market like this but we are going in with a plan. While I still believe that there could be more downside risk, we are going to try and buy some quality names at discount prices. There is a couple of ways to play McDonald’s and here is how I’m approaching it. For the near-term, I’m looking at the November 65 calls (MCDKM, $0.90, down $0.05) which you can buy for $100 a contract. If you normally buy 10 option contracts, buy only five in case we have to leverage down. In other words, take only a half position. I’m also looking at the in-the-money March 55 calls (MCDCK, $6.80, up $0.10) which gives me six months to ride out the current market storm. One contract would cost roughly $700 and if McDonald’s can get back to $67 (its 52-week high) by March these calls will be worth at least $12-$13 a contract. Good enough for a double. There are other quality companies going on sale right now so stay tuned… Rick Rouse]]>