The sellers aren't done with Neonode.
optionMONSTER's tracking programs detected a surge of activity in
the January 7.50 calls for $0.50 against open interest of just 779
contracts. Both blocks printed for $0.50, much closer to the bid
price than the ask, which indicates that they were sold.
NEON, which makes infrared touchscreens for consumer electronics,
is down 5.35 percent to $4.78 in afternoon trading. It reached an
all-time high $7.40 in early July but has been dropping since.
Selling calls is a common strategy when a trader believes that a
stock has limited upside. If it remains below the strike price, the
contracts will expire worthless and the premium earned will be kept
as profit. Above $7.50, he or she must unload their stock. (See our
section for more ways that options can be used to make money from
passage of time
NEON usually sees about 1,200 contracts in a typical session, but
today's volume is almost quadruple that amount.
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