The bulls think that the good times in Focus Media have only
optionMONSTER's Heat Seeker tracking program detected a surge of
call activity in the Shanghai-based advertising company, which owns
digital screens in public areas throughout the Chinese mainland.
Some 6,000 April 20 calls traded for $9 and $9.15, apparently sold.
Volume was below open interest, which suggests that an existing
position was closed. At the same time, 9,000 April 30s were bought
for $4.10 and $4.20 in a new opening trade, producing a credit of
about $1.7 million.
Together, this suggests that the investor had entered the calls
when FMCN was lower. He or she has now made a big profit and is
rolling the position up to the higher strike. The trader also
increased the number of contracts, which will provide more leverage
to a continued rally.
FMCN is up 6.79 percent to $26.59 in midday trading and has gained
about 60 percent from the beginning of the month. The stock fell
hard during the summer amid a wave of bearishness toward Chinese
companies, despite having consistently strong earnings.
Overall option volume is about 5 times greater than average in FMCN
so far today, with calls accounting for a bullish 71 percent of the
total, according to the Heat Seeker.
Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.