Calls explode in Dow Chemical

By
A A A

Dow Chemical exploded higher yesterday, and option activity went through the roof.

Almost 141,000 contracts changed hands in the name, compared with volume of 12,436 in an average session. Calls accounted for more than 80 percent of the volume, a reflection of the session's strongly bullish tone.

The largest transaction on optionMONSTER's Heat Seeker monitoring program was a call roll as an investor took profits on a winning trade. The investor sold 10,000 February 43 calls for $2.93 and bought 10,000 February 47 calls for $0.74. He or she collected a credit of $2.19 and still has the right to make money from further upside in the stock price. (See our Education section)

DOW rallied 6.64 percent to $45.93 after activist investor Daniel Loeb took a stake in the company and urged management to spin off its petrochemical business. It was the stock's highest closing price since October 2007.

The shares are also up 12 percent since getting recommended on the Dec. 12 installment our proprietary Market Action webinar. Dow is scheduled to report earnings next Wednesday, Jan. 29.




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: DOW

optionMONSTER

optionMONSTER

More from optionMONSTER:

Related Videos

Stocks

Referenced

83%

Most Active by Volume

100,376,898
  • $17.62 ▲ 0.51%
83,231,837
  • $25.62 ▲ 1.91%
75,739,329
  • $111.78 ▼ 0.77%
65,297,937
  • $36.37 ▼ 1.76%
59,053,093
  • $47.66 ▲ 0.29%
53,482,350
  • $2.59 ▼ 0.38%
51,504,284
  • $7.34 ▲ 2.37%
51,434,656
  • $8.14 ▲ 6.96%
As of 12/19/2014, 04:15 PM


Find a Credit Card

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