Wireless-tower stocks have been coming back to life, and now the
bulls are extending an upside bet in Crown Castle International.
optionMONSTER's Heat Seeker monitoring program detected the
purchase of 2,500 April 75 calls for $1.67 and the sale of an equal
number of March 75 calls for $0.77. Volume was below open interest
in the nearer-dated contracts, which indicates that an existing
position was closed and rolled forward in time.
lock in the price where a stock can be purchased, so investors can
buy them instead of shares to ride a rally. Given their cheap price
and leverage to the underlying equity, traders can often achieve
better results by swapping capital from one contract to another as
time passes. But if the stock stalls or declines, the calls will
lose value and can expire worthless. (See our
CCI is up 0.21 percent to $75.10 in afternoon trading. The company
has benefited from the long-term growth of wireless communications
and has mostly reported strong quarterly results.
The stock staged a big rally in 2012 but has been shuffling in a
range since early last year. Based on today's unusual activity,
someone apparently thinks that it's only a matter of time before
the stock goes on another run.
Rival American Tower has also been consolidating, though SBA
Communications broke out after aggressive upside trades last month
that generated huge profits almost immediately.
Total option volume in CCI is 7 times greater than average so far
today, according to the Heat Seeker. Calls outnumber puts by more
than 1,000 to 1.
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