Mako Surgical has bounced back hard after the recent selloff,
and one investor is adjusting a hedged position.
optionMONSTER's tracking programs detected the purchase of 2,300
August 30 calls for $2.65 against existing open interest. An equal
number of September 30 calls were sold at the same time for $3.35.
The investor probably owns the medical-device stock and has been
short the calls as a way to earn income. By rolling the position
today, he or she collected an incremental $0.70 of income and
agreed to remain in the trade for an additional month. (See our
MAKO is up 0.22 percent to $31.82 in midday trading. It more than
tripled between last November and May as use of its
robotic-surgical machines spread, but has been consolidating its
gains since then.
Today's trade is noteworthy because the investor is using
in-the-money contracts, which reduces their risk of loss but also
results in smaller potential profit. He or she is probably hoping
that the shares will continue to advance and is using that belief
to generate an income stream from selling options.
Overall option volume in MAKO is almost 3 times the daily average,
with calls outnumbering puts by 17 to 1.
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