Trader sees Apollo coming back to earth

By
A A A

Apollo Group has tried to rally, but one bear expects the education company's stock to come back to earth.

optionMONSTER's Depth Charge monitoring system detected the purchase of 4,500 February 45 puts for $1.52 and the sale of an equal number February 55 calls for $1.36. Volume was more than 4 times open interest in both strikes.

The trader collected a credit of $0.16 and will make money from APOL dropping in the next two months. He or she would be forced to sell shares if it rallies above $55, a level that's been resistance for more than a year.

The position may be the work of an investor looking to hedge a long position in APOL shares. If that's the case, it would be a collar trade. (See our Education section)

APOL fell 0.4 percent to $50.04 yesterday but is still up 7 percent in the last month, contrasting with a 2 percent decline in the broader market. Apollo's last earnings report on Oct. 19 beat expectations on the top and bottom line as the company adjusts to a stricter regulatory environment.

The shares have been attempting to work their way higher for the last year after a government crackdown on student debt caused the entire sector to tank in 2010.

Overall option volume in APOL was 4 times greater than average yesterday, according to the Depth Charge.




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: APOL

optionMONSTER

optionMONSTER

More from optionMONSTER:

Related Videos

Stocks

Referenced

Most Active by Volume

69,589,453
  • $17.71 ▲ 0.51%
67,826,144
  • $92.90 ▼ 14.34%
43,457,267
  • $7.15 ▲ 5.61%
41,474,187
  • $112.94 ▲ 1.04%
39,656,564
  • $7.45 ▲ 4.78%
38,604,858
  • $15.49 ▲ 9.01%
34,600,059
  • $25.71 ▲ 0.35%
32,095,432
  • $104.58 ▲ 0.25%
As of 12/22/2014, 04:15 PM


Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com