Riverbed Technology has pulled back following a big move, but
one investor is a believer over the long term.
optionMONSTER's Heat Seeker monitoring program detected the
purchase of 3,000 September 21 calls for an average premium of
$0.975 and the sale of an equal number of June 21 calls for
$0.55. Volume was below open interest in the nearer-dated
contracts, which suggests and existing position was closed and
rolled forward in time.
Calls lock in the price where a stock can be bought, letting
investors cheaply position for a rally. Capital can also be moved
from one contract to another, avoiding the impact of time decay
that eats away at options as days and weeks pass.
RVBD rose 0.15 percent to $19.49 in afternoon trading. The
networking company fell to long-term lows in 2014, then rallied
about 60 percent by late February amid takeover rumors. It's been
skidding lower since.
Given that the short-term momentum is bearish, today's investor
is wants more time for the shares to bounce. Adjusting he or her
position cost about $0.425, but also gave them an additional
three months. That will protect them against time decay in the
near term. (See our
The company's next earnings report is scheduled for April 29.
Overall option volume is 7 times greater than average in the
name, according to Heat Seeker. Calls account for a bullish 80
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.
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