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, Joe Springer (429 clicks)
Long/short equity
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Mitt Romney is scaring coal shorts including Arch Coal (NYSE:ACI), Peabody Energy (NYSE:BTU), Alpha Natural Resources (NYSE:ANR), Cloud Peak Energy (NYSE:CLD), and James River (JRCC).

Romney says "I like coal" and has indicated he would scale back some of the EPA regulations of the Obama administration. A win for him would surely see coal stocks surge and shorts would be scrambling to cover their positions. As such, as long as Mitt has a chance to win, the coal stocks downside should be limited as they were already priced for an Obama re-election.

This presents an opportunity to game not a Romney victory, although that has some delicious possibilities, but to game Romney keeping the coal shorts at bay until the election is over. Our suggestion to game this Romney-floor is to sell cash-secured puts on coal names like Arch.

Dive in and sell puts to take advantage. Check out our articles on selling puts to get some background:

Source: Romney Scares Coal Shorts (Video)