One investor wants to give Plains Exploration & Production
more room to roam.
optionMONSTER's tracking programs detected the sale of 2,870
February 35 calls for $2.54 and the purchase of an equal number of
January 33 calls for $3.01. Volume was below open interest in
January but not in February, which suggests that an existing short
position was rolled from one strike to the other.
The trade was probably the work of an investor who owns shares in
the Houston-based energy driller and was using the options as part
strategy. He or she would have sold the January contracts at a
previous date to earn income. (See our
Adjusting the position cost $0.47 but gives the trader the right to
sell shares for $2 more. He or she also agreed to stay in the trade
for an additional month, so it's an example of how investors can
turn time into money using options.
PXP rose 2.39 percent to $35.17 yesterday. It traded as low as
$20.25 in early October, rallied back hard and has been
consolidating between $31 and $37 since then.
Overall option volume was triple the daily average in the session,
with calls outnumbering puts by 9 to 1.
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.
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