Magna International is testing its highs, and one big investor
is looking for a breakout.
optionMONSTER's Heat Seeker monitoring program detected the
purchase of 5,000 March 90 calls for $1.90 and the sale of an equal
number of March 95 calls for $0.50. Volume was more than 14 times
open interest in each strike, indicating that new positions were
The investor stands to collect $5 if the auto-parts maker closes at
$95 or higher by expiration in mid-March. That would be a profit of
271 percent based on the initial $1.40 outlay. (See our
section for more on
MGA rose 1.17 percent to $87.85 on Friday and is up 65 percent in
the last year. The shares traded within a penny of their all-time
high from Nov. 6, when they surged on a strong earnings report.
They pulled back as far as $76 in mid-December before rebounding.
The company hasn't announced the date for its next quarterly
release, but last year's calendar suggests that it will occur in
early March. So that spread would profit from a strong set of
Overall option volume was 83 times greater than average in the
session, according to the Heat Seeker, with calls accounting for
almost 99 percent of the total.
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