One trader expects a non-event when Lamar Advertising reports
earnings two weeks from now.
optionMONSTER's tracking systems detected the sale of 2,500
December 39 puts for $1.95 and 2,500 December 40 calls for $1.85.
Volume was more than 200 times open interest at both strikes,
indicating that a new position was initiated.
It generated a credit of $3.80, which will be the trader's maximum
profit if the billboard owner closes between $39 and $40 on
expiration. Gains erode outside of that range, turning to losses
below $35.20 and above $43.80.
LAMR fell 0.23 percent to $39.23 yesterday and has been moving
sideways for the last two weeks. Option premiums have been rising
for the last month as investors brace for the results, which will
be released before the open on Nov. 7.
By selling calls and puts, yesterday's trader took the other side
of the market and is betting that the numbers will be a non-event.
If they're right, the contracts will lose value and their position
will gain. (See our
The trade, known as a
, pushed overall option volume in LAMR to about twice the daily