Traders have made a killing in Canadian Natural Resources, and now they're coming back to the name before this week's earnings report.
optionMONSTER's Heat Seeker monitoring program detected unusual activity the energy driller, with two calls in particular standing out. They first snapped up 2,000 March 38s for $0.35 and $0.40 against previous open interest of just 625 contracts.
Less than an hour later they returned, this time buying 6,100 of the September 38 calls for $1.95. Volume was more than twice open interest in those.
These long calls lock in the price where a stock can be purchased, letting investors play for a rally while risking less capital than would be the case owning shares. The strategy is especially appropriate before a potentially important event such as quarterly results before the opening bell Thursday. (See our Education section for more on how to reduce your losses with options.)
CNQ is up fractionally at $36.85 in afternoon trading and has risen 10 percent in the last month. Much of that move followed huge bullish activity in the September 34s a month ago, and those contracts more than doubled as the stock pushed higher.
Total option volume is triple the daily average so far in the session, with calls outnumbering puts by 3 to 1.
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