One way or another, the bulls think Fusion-IO is ready to
optionMONSTER's Heat Seeker monitoring program detected the
purchase of 5,000 January 15 calls for $2.05 and the sale of an
equal number of January 18 calls for $1.05. Volume was below open
interest at the higher strike, so there are two possible
explanations for the trade.
One is that the investor previously owned the 18s, but then lost
money as the data-storage company fell. Rolling the
down to the 15s would increase his or her
because the new contracts are
closer to the money
. (See our
Alternatively, both halves of the trade may have been opened. In
that case, it was a
bullish call spread
with potential profit of 200 percent on a move to $18 by expiration
early next year.
FIO is up 7.07 percent to $14.02 in afternoon trading. The stock
gapped sharply lower on May 8 after a big management shakeup but
has been holding its ground despite weakness in the broader market.
Its last earnings report in April was also strong, which could make
some investors like the stock and look for a rebound.
Total option volume is quadruple the daily average so far today,
with calls outnumbering puts by almost 9 to 1.
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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