Williams reports earnings this week, and one investor is looking
for a big move.
optionMONSTER's tracking systems detected the purchase of 7,000
June 32 calls for $2 and 7,000 June 28 puts for $0.20, resulting in
a total cost of $2.20. Volume was more than 4 times open interest
in both strikes.
The trade, known as a long strangle, will profit from the
natural-gas stock ripping higher or dropping sharply. It's a common
strategy when investors expect a news event to cause a spike in
volatility. (See our Education section)
WMB rose 0.74 percent to $33.41 in morning trading. The shares have
rallied 54 percent in the last six months as investors pour into
the natural-gas sector, and today hit their highest price since
The company will publish results after the bell on Wednesday. Its
last earnings report on Feb. 17 crushed estimates, and management
added fuel to the fire by announcing it would split its exploration
and pipelines businesses into separate companies.
The strangle trade pushed overall option volume in WMB to twice the
daily average so far today.
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