Call buyers go shopping at L Brands

By
A A A

L Brands popped on strong same-store sales earlier this month, and the bulls came back to the store on Friday.

optionMONSTER's tracking programs detected the purchase of some 3,000 May 48 calls, most of which priced for $1.30 to $1.40, in volume above the previous open interest of 2,110 contracts. There was also heavy trading in the May 50s for $0.55 to $0.61.

Long calls lock in the price where investors can buy shares in the retail company, formerly known as Limited Brands. That gives these contracts the potential to generate significant leverage in a rally, but they'll lose most or all their value if the stock drops or doesn't move. (See our Education section)

LTD rose 1.13 percent to $48.42 in the session. The stock ripped as high as $51.25 on April 11 after March same-store sales rose 3 percent, beating analysts' expectations.

The strength occurred across its chains, which include Victoria's Secret and Bath & Body Works. The shares then retreated, but Friday's option activity is looking for them to continue higher over the next four weeks.

Total option volume was 6 times greater than average in the session, with calls outnumbering puts by a bullish 19 to 1.

(A version of this post appeared on InsideOptions Pro on Friday.)



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.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.


This article appears in: Investing , Options

Referenced Stocks: LTD

optionMONSTER

optionMONSTER

More from optionMONSTER:

Related Videos

Stocks

Referenced

Most Active by Volume

64,159,633
  • $100.86 ▼ 0.76%
63,552,623
  • $16.71 ▼ 0.18%
60,140,251
  • $42.71 ▲ 0.38%
52,385,870
  • $17.51 ▲ 5.86%
50,329,585
  • $13.75 ▲ 29.84%
43,337,551
  • $16.16 ▼ 1.40%
40,126,911
  • $3.605 ▲ 0.56%
39,836,742
  • $3.81 ▼ 2.56%
As of 9/16/2014, 04:15 PM

Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com