Activision Blizzard has been explosive, and traders are giving
it more room to run.
optionMONSTER's Heat Seeker monitoring system detected the purchase
of 55,750 September 17 calls for $1.26 and the sale of an equal
number of September 19 calls for $0.30. Volume was below open
interest in the 17s, which suggests an existing short position was
closed and rolled to the higher strike.
The investor almost certainly owns shares in the videogame stock
and had sold calls against it to earn premium. Adjusting up to the
19s let him or her the right to earn an additional $2 on their
shares. They paid $0.96 for that right. (See the discussion of
section for more.)
ATVI is up 3.03 percent to $17.99 in afternoon trading. The move
comes just one day after the stock rallied 15 percent on a deal to
buy back more than half its shares from France's Vivendi at a
discount to current market prices.
Momentum has also been strong in the video-game space, beginning
today's session as the seventh-best performing group of more than
100 industry subsets tracked by our proprietary researchLAB market
scanner in the last week.
ATVI is scheduled to announce second-quarter results after the
closing bell on Thursday, Aug. 1. Based on today's transaction, the
investor wants to make sure they don't miss a rally on potentially
good news. Rival Electronic Arts gapped higher on strong results
Almost 130,000 contracts have traded in the name so far today,
compared with 14,505 in an average session.
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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