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Is LyondellBasell still going up?

By: optionMONSTER
Posted: 8/21/2012 3:31:00 AM
Referenced Stocks: LYB

LyondellBasell Industries has been going straight up, and one investor is adjusting a profitable trade.

optionMONSTER's Heat Seeker monitoring system detected the purchase of about 3,000 September 52.50 calls for $0.50 and the sale of an equal number of September 50 calls for $1.25. Volume was below open interest in the 50s but not the 52.50s, which indicates that an existing long position was rolled to the higher strike.

The investor collected a credit of $0.75 and stands to profit if the shares continue to push higher. He or she probably bought the 50s when the stock was lower and adjusted the position to recover some of their cash. See our Education Section for more on how options can be used to manage risk.

LYB rose 1.26 percent to a new all-time high of $49.86 yesterday and is up more than 75 percent in the last year. Weakness in Europe hurt the chemical company earlier in the year, but results improved in the second quarter as low natural-gas prices in the U.S. boosted profitability.

Overall option volume was triple the daily average, with calls outnumbering puts by more than 10 to 1.