Calpine rallied yesterday, and one investor apparently thinks
that the power company still has room to run.
With less than two minutes remaining in yesterday's session,
optionMONSTER's Heat Seeker monitoring program detected a surge of
call volume as a large bullish trade was rolled forward in time.
It entailed the sale of 5,082 October 18 calls for $0.25 at volume
that was under open interest and the purchase of an equal number of
November 19s for an average premium of $0.325. Adjusting the
position spared the investor from another day of
, which will erase the value of those October contracts at an
accelerating pace as expiration approaches this Friday. (See our
As a result, he or she now has an additional four weeks to profit
from a rally by the electrical-generating company. The trader paid
about $0.075 to extend the position.
CPN rose 4.12 percent to $18.20 yesterday and has been slowly
trending higher since the market bottomed in early 2009.
The roll accounted for most of Calpine's option activity in the
session, pushing its total volume to 15 times greater than average.
Calls outnumbered puts by a bullish 33-to-1 ratio, according to the
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