An investor sold the upside in Campbell Soup yesterday,
targeting a key level from last summer.
optionMONSTER's tracking programs detected volume of 6,400 August
35 calls for $0.46 against open interest of just 363 contracts. The
premium was much closer to the bid price, indicating the trade was
That $35 level is roughly the same place where the food stock
peaked in late June and early July before dropping to a multi-year
low in August. The investor is now obligated to sell the stock if
it returns to that price but, including the credit earned, the exit
price would be $35.46. He or she probably owns the equity and is
using the options as part of a
CPB, which fell 0.06 percent to $33.66 yesterday, has been an
extremely slow-moving stock. It's up just 5 percent since the
August lows, compared with a 17 percent gain for the S&P 500 in
the same period.
Yesterday's call seller may have purchased the stock at the lows of
last summer and is now using the contracts to establish a selling
date one year later to reduce tax liabilities. It also lets the
investor get paid for the
passage of time
. (See our
Overall option volume was 9 times greater than average in the
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.
Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.