FirstEnergy is a slow-moving utility, but it handed traders some
fast money on Friday.
Shortly after the opening bell, optionMONSTER's Heat Seeker system
detected heavy buying in the November 38 calls and the November 39
calls. The paper hit with the stock holding multi-year lows and
followed similar bullish activity in recent weeks.
FE then started grinding higher, and the calls began doing their
work. The stock was up 1.36 percent to $38.84 by the end of the
session, but the options had almost doubled in value.
The November 38s, which initially priced for $0.35 to $0.55, traded
for as much as $1.10. And the November 39s climbed to $0.45 from
their early range between $0.20 and $0.25. Some 5,800 contracts
traded in the 38s, while the 39s saw volume close to 5,000.
lock in the price where a stock can be purchased. Given how cheap
they are, even a small move in the underlying share price can
result in significant leverage in the options--which is exactly
what happened on Friday in FirstEnergy. (See our
Overall turnover in the FE was 10 times greater than average in the
session. Calls accounted for a highly bullish 98 percent of that
(A version of this post appeared on
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