James Altucher has come out with a list of his top ten picks for 2010, which are:

1. Assured Guaranty (NYSE: AGO), the municipal bond insurer, got the entire playing field to itself after the speculation in mortgage-backed securities knocked out competitors MBIA (NYSE: MBI) and Ambac (NYSE: ABK). Also, Altucher likes that municipal bond defaults stood at just 0.14% this year.

2. Wellcare Health Plans (NYSE: WCG) has resolved its issues with Medicare and James thinks Wellcare will be in great demand as a mediator between the corporate and the government.

3. Rapid urbanization and the consequent need for high soil fertility and yields is what will drive Potash (NYSE: POT) in 2010. Altucher also likes that Potash also represents George Soros’ third largest position.

4. Cash America (NYSE: CSH) has been riding high as the new financier to the sub-prime community. Altucher says that most people pawn gold in a pawnshop and that makes the pawnshop chain a backdoor means to play an increase in gold prices. Other ways to play gold are through ETFS like SPDR Gold Trust (ETF) (NYSE: GLD) and Market Vectors Gold Miners (ETF) (NYSE: GDX).

5. Medical supplier Becton, Dickinson (NYSE: BDX) is Warren Buffet’s latest investment and and BDX has raised its payout for the 37th straight year. Becton looks set to grow with the medical needs of an aging Baby Boomer population.

6. Hillenbrand (NYSE: HI) has a virtual monopoly on the casket industry, catering to 16,000 of the 22,000 funeral homes in the U.S, says Altucher. Favorable demographic and past dividend trends make Hillenbrand a good buy.

7. Altucher likes Telecom Corp of New Zealand (NYSE: NZT) because it is a monopoly in its home country. Also, Altucher likes NZT in 2010 because the Kiwi dollar is the currency most closely correlated to gold prices.

8. STEC (Nasdaq: STEC) faced a problem when EMC (NYSE: EMC) had an inventory glut of their SSD product. .However, a price target of $42 for this $12 stock suggest things are better than they seem for STEC.

9. Alvarion (NASDAQ: ALVR) supplies WiMax networks to the developing world. Altucher said this is a high growth area and ALVR is trading cheap.

10. Altucher thinks GlaxoSmithKline (NYSE: GSK) could do well in 2010 as it is another stock that Buffett holds for the same reason as Becton Dickinson.

Sentiment

Stocks opened higher on diminishing worries about the Dubai credit debacle and are holding gains following a round of mixed economic news Tuesday. The day before, the Dow traded in negative territory throughout most of the trading session, but finished up 35 points after a report released late in the day said that Dubai World's affected debt was a less-than-expected $26 billion. In addition, the company said it was in constructive talks with creditors to restructure the debt.

The momentum carried forward to Tuesday morning and then attention turned to a mixed round of economic data at 10:00 a.m. eastern time. The reports showed a surprise drop in manufacturing courtesy the ISM index, but better than expected readings on pending home sales and construction spending.

Today’s tickers: ACE, EFA, HAL, AMAT, WHR, DE, JTX & WCG

ACE - ACE Limited – The surge in demand for call options on the insurance company today drove option implied volatility up 19.75% to 28.67%, while shares gained more than 2% to $49.78 during the trading day. Investors populating the December contract exhibited bullish sentiment on ACE by selling puts and buying calls. Approximately 3,000 puts were shed at the December 50 strike for an average premium of 1.51 apiece, while some 2,100 calls were purchased at the same strike for roughly 89 cents each. Call volume at the January 50 strike sky-rocketed to 21,666 contracts – on previous existing open interest of just 1,402 calls – as traders scooped up about 20,000 lots for a premium of 1.42 per contract. Investors long the January contract call options are positioned to accrue profits if ACE’s shares trade above the breakeven price of $51.42 by expiration.

EFA - iShares MSCI EAFE Index ETF – The exchange-traded fund, which includes stocks from Europe, Australasia and the Far East, attracted bearish option players despite the 2.5% rise in shares today to $56.88. One investor, who may hold a long position in the underlying stock, unfurled a ratio put spread in the January 2010 contract. The trader purchased 10,000 puts at the January 55 strike for an average premium of 1.39 each, and sold 20,000 puts at the lower January 52 strike for about 70 cents apiece. The investor pockets a net credit of 1 penny per contract on the trade and establishes downside protection in case shares of the EFA decline ahead of expiration. The 1 cent credit is ‘free money’ for the trader as long as the shares remain above $55.00 through expiration in January.

HAL - Halliburton Co. – Options activity on the oil and gas company today suggests at least one investor is bracing for potential share price erosion through expiration in January. Halliburton’s shares rose 1% during the session to $29.57. The trader responsible for the bearish ratio put spread is likely holding a long position in the underlying stock. If this is the case, today’s transaction provides downside protection for the investor. It appears 5,000 puts were purchased at the January 29 strike for an average premium of 1.24 apiece, spread against the sale of 10,000 puts at the lower January 24 strike for 18 pennies each. The net cost of the ratio…

Whirlpool Corp. (WHR) – Shares at household white-goods manufacture, Whirlpool are higher by 3.6% today at $76.85 and a single combination trade in its options has landed it on our radar screen today. We’re pretty sure this was a plain-vanilla put spread using defensive options expiring in January at the 70 and 60 strikes. The trade, however, may have a twist to it. The 20,000 lot transaction appears to be the purchase of the upper strike and simultaneously sale of the identical amount of lower strike puts. Since the distance between the two strike prices is $10 the maximum gain is this value less the net cost of the two premiums, which is 1.55. The puts at the lower strike appear to have been sold at 50 cents this morning. That means that a slide for Whirlpool might deliver a maximum profit of 8.45 per contract in the unlikely event of a near-$17 decline in the share price. However, as we said above, there may be a twist here. Back in late October when shares were trading at $71.74 we can see the sale of a similar block of puts at the $60 strike at a 1.65 premium at the time. It is possible that today the investor is closing out that short position for a 1.15 profit and establishing a fresh short on the puts (writing premium) at the 70 strike. We’ll only learn more when open interest data is updated Wednesday.

Deere & Co. (DE) – Shares of the agricultural equipment maker are up more than 1% today to $54.15, but options activity on the stock suggests investors are bracing for potential bearish movement in the price of the underlying through March of 2010. One DE-pessimist enacted a butterfly spread in the March 2010 contract. The investor might be protecting the value of a long stock position with the spread. Otherwise, the trader is outright bearish on Deere, and is hoping to amass profits to the downside by expiration. The spread involved the purchase of 15,000 puts at the March 50 strike for a premium of 2.70 apiece [wing 1], and the purchase of another 15,000 puts at the lower March 30 strike for 10 cents each [wing 2]. The wings of the butterfly were spread against the sale of 30,000 puts at the central March 40 strike for 60 cents premium apiece [body]. The net cost of the bearish play amounts to 1.60 per contract. Maximum potential profits of 8.40 per contract are available to the investor if shares plummet 26% from the current price to $40.00 by expiration in March. Profits, or downside protection on a long position in the underlying, kick in if Deere’s shares decline through the breakeven price of $48.40.

Sentiment

Stocks opened higher following a round of better-than-expected economic data, and have since slipped into a post-holiday lull midday. Data released before the opening bell on Wall Street showed personal incomes and spending increasing by .2 percent and spending by .7 percent, respectively, in October, which was better than the .1 percent and .5 percent economists had expected. Separate data showed weekly jobless claims falling by 34,000 to 466,000 in the period ended November 21. Economists were looking for a smaller 1,000 decline.

The latest durable goods report was a bit of a downer, however. It showed an unexpected drop in October. Total orders fell .6 percent and, excluding transports, fell 1.3 percent. Economists were looking for a modest increase.

Here is a list of stocks which traded higher Tuesday November 10, 2009 on unusually higher volume. I will keep an eye on these stocks Wednesday to see if there is continued buying pushing the stocks higher. This method is just one of the ways I use to pick stocks to structure particular option trades. This post requires the knowledge of stock options. To learn more about the option strategies outlined in this post, risks, pricing, calculations, other strategies, and options in general, click here.

The table below shows the company, ticker, per share % increase, and volume increase (% increased compared to 50 day average). For your convenience I have ranked the stocks in order from greatest to least volume % change.

The health insurance stocks listed below may experience some extra volatility this week, as President Obama is scheduled to address the nation about health care reform on Wednesday, September 9. After months of speeches, interviews and town hall meetings, this Wednesday, the President will tell Congress and the American people something they haven't heard before: exactly what he wants to see in health care reform. As White House Press Secretary Robert Gibbs told the press, "people will leave that speech knowing where he stands." That may answer whether President Obama will insist on the controversial "public option," a government-provided health insurance alternative. The White House was still avoiding directly answering that question today. "He believes the public option is a good tool," White House adviser David Axelrod said today. "It shouldn't define the whole health care debate, however." A September 15 deadline for a bipartisan deal on health care reform is looming. The deadline was set by Democratic Senator Max Baucus of Montana, the chairman of the Senate Finance Committee. Six members of the committee - three Democrats and three Republicans - have been trying to negotiate a bipartisan health reform bill. However, Baucus has said he would pull the plug on the talks "around September 15." Presidential aides have promised Obama will take back the reins after allowing Congress to work its will on his idea, without one specific plan for Democratic lawmakers to defend back home. We’re entering a new season,” senior adviser David Axelrod said in an interview Tuesday. “It’s time to synthesize and harmonize these strands and get this done. We’re confident that we can do that. But obviously it is a different phase. We’re going to approach it in a different way. The president is going to be very active.”

“We have been saying all along that the most important part of this debate is not the public option, but rather ensuring choice and competition,” an aide said. “There are lots of different ways to get there.”

Some of the stocks to keep an eye on include:

Aetna Inc. (NYSE:AET) UnitedHealth Group Inc. (NYSE:UNH) Health Net, Inc. (NYSE:HNT)WellPoint, Inc. (NYSE:WLP) Humana Inc. (NYSE:HUM)CIGNA Corporation (NYSE:CI)WellCare Health Plans, Inc. (NYSE:WCG)Coventry Health Care, Inc. (NYSE:CVH)Health Net, Inc. (NYSE:HNT)

WellCare Health Plans Inc. (NYSE: WCG) said on Wednesday that it would start marketing Medicare drug and Medicare Advantage programs in the next few days. It has received approval against most of the government's fraud sanctions, earlier sanctioned on WellCare Health Plans Inc. (WCG).

WellCare Health Plans Inc. (WCG) stock, after opening at a 52 week high around $31.5 with a gap-up opening, however, started slipping in the mid day trades on "sell on news" and shrinked to $28.31.