Cheniere Energy is already up 39 percent in the last two months,
and traders continue to pile in.
optionMONSTER's Heat Seeker monitoring program detected the
purchase of 9,000 January 2015 35 calls in the natural-gas tanker
stock for $8.20. Equal-sized blocks were sold in the January 2015
30 puts for $3.20 and the January 2015 50 calls for $2.85. Volume
was more than twice open interest at all three strikes, indicating
that a new trade was initiated.
The strategy combines a
bullish call spread
to leverage a rally with
to earn income. It cost $2.15 and will expand to $15 if LNG closes
at or above $50 on expiration--profit of 598 percent. The investor
is also on the hook to buy shares for $30 if they close below that
level on expiration 15 months from now. (See our
LNG is up 1.75 percent to $37.25 in afternoon trading and has been
rallying since heavy call volume lit up the Heat Seeker back on
. The company has consistently reported quarterly losses but
controls the Sabine Pass LNG terminal in Louisiana, making it a key
player in the future natural-gas export industry.
Overall option volume is 5 times greater than average in the name
so far today, according to the Heat Seeker. That bullish three-way
trade accounts for roughly half the total.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.
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