Ford Motor rallied more than 800 percent off its 2009 lows
before stalling in the spring, and now one investor is betting on
optionMONSTER's Heat Seeker tracking system detected the purchase
of 150,000 September 12 calls for $0.41, matched against the sale
of 75,000 September 14 calls for $0.09 and 75,000 September 15
calls for $0.05. The total cost was a debit of $0.27.
F rose 2.17 percent to $10.85 on Friday and has lost about
one-quarter of its value since hitting a five-year high in late
April. The company traded as low as $1.50 in March 2009 but then
surged back after the credit market improved and a new vehicle
lineup combined with a strong economy to drive sales.
The option trade is designed to capture another push to the upside
and will earn a maximum profit of 266 percent if F closes at or
above $16 on expiration. The strategy, known as a "Christmas tree,"
resembles a vertical spread but includes the sale of two different
The next scheduled event that could serve as a potential
catalyst for the name is the release of July sales on Aug. 3.
The Christmas tree pushed total options volume in F to about five
times greater than average. Calls accounted for a bullish 93
percent of the activity.
(Chart courtesy of tradeMONSTER)
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