The bulls are betting that Argentine oil driller YPF is ready
for a comeback.
The stock cratered in April 2012 after politicians in Buenos Aires
announced plans to push out Spain's Repsol as the main investor
before settling at nine-year lows. Now that the shares have been
climbing, one investor is rolling a winning trade higher.
optionMONSTER's Heat Seeker monitoring system detected the purchase
of about 9,200 October 17.50 calls for $0.85 and the sale of an
equal number of July 15s for $1.10. Volume was below the previous
open interest in the 15s, so it appears that an existing
was closed and moved to the higher strike.
Adjusting the trade let the investor collect $0.25 while remaining
long the name for an additional three months. That way the trader
won't miss a huge rally but will also have limited risk if the
stock tanks. (See our
section for more on how to manage risk with options.)
YPF trading at $16.21 this afternoon, up 1.95 percent on the day
and 23 percent in the last three months. While the fight with
Repsol clearly scared some investors, Chevron struck a deal with
the company in May to develop its potentially massive Vaca Muerta
shale-gas formation. That could give some investors confidence that
the worst of the uncertainty is over. It also trades at less than
Overall option volume is 35 times greater than average in the name
so far today, according to the Heat Seeker. Calls account for a
bullish 87 percent of the total.
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