One investor wants to get paid waiting for a rally in Canadian
optionMONSTER's tracking programs detected the sale of 1,873 July
32 calls for $0.22 and the purchase of an equal number of June 32
calls for $0.05. Volume was below open interest in the June
contracts, indicating that an existing short position was closed
and rolled forward in time.
The investor probably owns shares in the Calgary energy company and
has been selling calls to earn income. Adjusting the position
allowed the trader to collect an additional $0.17 of premium but
obligates him or her to sell the stock for $32 if it closes
above that level on expiration. (See our
section for more on the strategy, known as a
CNQ rose 0.61 percent to $29.65 yesterday and has been churning in
a range for more than a year. The stock's technicals have been
mostly bearish, with the shares mostly below their 200-day moving
average since July 2011.
But they've been holding their ground since March, which could make
some traders think that they're ready for a turnaround. In the
meantime, the investor can collect the 1.6 percent dividend yield
and earn income selling calls.
Total option volume was quadruple the daily average in the
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.