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Carter Worth And Mike Khouw's Verizon Trade

On CNBC's Options Action, Mike Khouw suggested a bullish options strategy in Verizon Communications Inc. VZ.

He thinks it would be a good idea to buy the November 52.50 call for $1.12, which is around 2.1 percent of the stock price.

The trade breaks even at $53.62 or 3 percent higher from the current stock price. If the stock trades lower, Khouw would sell a downside put for the same amount or slightly more to get his initial investment back.

Carter Worth commented on the trade from a technical standpoint. He believes the stock could trade higher because it's currently trading at its long-term support and also on its trend line. He added that Verizon has 2.75 times higher yield than 10 year T-bonds.

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