Carnival is rebounding from a nine-month low, and traders see no
optionMONSTER's tracking systems detected the sale of more than
3,000 August 36 puts, most of which priced for $1.55. Volume was
almost 70 times open interest in the strike.
The trades reflect a belief that the cruise-ship company has
limited downside. If the trader is right, he or she will get to
keep the premium. If the bet is wrong, the trader will have to buy
shares for $36. Given the credit received today, the position will
make money as long as CCL stays above $34.45.
The shares are up 3.47 percent to $36.97 in afternoon trading but
have lost more than one-fifth of their value since mid-February.
Today's pop came after CCL's second-quarter earnings and revenue
Management cut full-year guidance, citing global events such as
conflict in the Middle East and the Japanese earthquake. But
investors now seem to be focusing on the company's long-term
strengths, which include the ability to increase prices after the
introduction of new vessels.
Overall option volume in the name is 6 times greater than average
so far today.
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