Expert trader and options specialist Bernie Schaeffer has taken contrarian positions in two investment banks in his "master trading" portfolio. Here's the latest form his Schaeffer's Investment Research.

"I have initiated a long position in Merrill Lynch (NYSE: MER). The brokerage stock hit a pivot low on March 17, 2008 due to the Bear Stearns news. This 52-week low was established with above average
volume. Since making this pivot low, MER has rallied 32%.

"This stock's 10-day put/call ratio on the International Securities Exchange has hit capitulation levels. This reading is at 100%, which means the puts purchased versus calls purchased on its exchange is at the highest reading over the past year.

"In addition, I initiated a long position in Lehman Brothers Holdings (NYSE: LEH). Like MER, LEH made a pivot low recently due to the Bear Stearns news. Since making 52-week lows at $35.67, the brokerage company has rallied 32%.

"A significant amount of skepticism encompasses LEH shares. The Schaeffer's put/call open interest ratio is 2.5, higher than 91% of the daily readings during the past year."

Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.