For the second time in a week, the bulls are active in
, optionMONSTER's Heat Seeker tracking program detected buying in
the January 80 calls for $1.83. The weight-loss stock has been
pushing higher, and those calls are up almost 50 percent.
Today's paper is hitting one month later: About 4,000 February 70
calls were sold for $8.90, and a similar number of February 75
calls were bought for $6.45. Volume was below previous open
interest at the lower strike, so it appears that an existing
was closed and rolled to the higher strike.
The investor collected a credit of $2.45 by making the adjustment
and will keep making profits if the stock continues to rally. The
was reduced from 0.63 to 0.51, meaning that the trader recovered
more than one-quarter of the initial capital at risk in return for
surrendering less than one-fifth of the upside exposure. (See our
section for more on how to trade more efficiently with options.)
HLF rose 4.31 percent to $74.95 in afternoon trading and is up more
than 120 percent so far this year. It's been riding a global wave
of obesity, expanding into Latin America and Asia while fighting
bearish bets by hedge fund manager Bill Ackman along the way.
Earnings have beaten expectations for at least three straight
Total option volume in HLF is nearly quadruple its daily average so
far in the session, according to the Heat Seeker. Calls outnumber
puts by a bullish 4-to-1 ratio.
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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