The bulls come back to UnitedHealth

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The bulls targeted UnitedHealth for the second session in a row yesterday.

optionMONSTER's tracking programs detected the purchase of about 10,000 November 60 calls for $0.32 and $0.33. Open interest in the strike was 7,305 contracts at the beginning of the day, indicating that new positions were initiated.

The calls lock in the price investors must pay to buy shares in the health-insurance giant. That gives them significant leverage in the event of a rally, but the contracts can expire worthless if the shares don't move. (See our Education section)

UNH fell 0.64 percent to $56.18 yesterday but has been holding support at its 200-day moving average after a so-so quarterly report last week. Investors purchased the November 55 calls on Monday , also looking for a rally.

Overall option volume in UNH was quadruple its daily average yesterday, with calls accounting for a bullish 80 percent of the total.

(A version of this post appeared on InsideOptions Pro yesterday.)



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.


This article appears in: Investing , Options

Referenced Stocks: UNH

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