Frantic call buying in Bon-Ton rally

By
A A A

Bon-Ton Stores bounced hard last week, and traders scrambled to get long.

The debt-laden retailer surged 9.70 percent to $11.20 on Friday, adding to a 13 percent gain the previous session. The rally came after a poor earnings report failed to push the stock under key support at $8.80. A wave of short-covering followed.

Call volume heated up as well, according to optionMONSTER's tracking systems. Activity was especially heavy in the October 11 contracts, with more than 5,700 trading against open interest of just 59. The largest blocks priced for $0.50 to $0.60.

Those call buyers now have the right to buy the stock for $11 through expiration in mid-October no matter how high it may be at the time. They could be bulls hoping for a rally or bears hedging downside positions. (See our Education section)

BONT is still down more about 40 percent from its 52-week high reached in December. It's been trapped below $12 almost the entire year.

Overall option volume was 28 times greater than average in the session, with calls accounting for a bullish 95 percent of the total.



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: BONT

optionMONSTER

optionMONSTER

More from optionMONSTER:

Related Videos

Stocks

Referenced

Most Active by Volume

75,031,044
  • $16.26 ▲ 0.31%
64,683,841
  • $99.76 ▲ 2.14%
44,561,744
  • $14 ▼ 6.23%
37,984,130
  • $27.93 ▲ 0.36%
36,148,020
  • $94.39 ▲ 1.49%
33,981,456
  • $22.93 ▼ 1.38%
33,971,527
  • $44.08 ▲ 1.03%
33,685,322
  • $76.95 ▲ 1.32%
As of 10/20/2014, 04:15 PM

Find a Credit Card

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