Markets

Bulls find a home in Lennar

Somebody is bullish on Lennar.

optionMONSTER's Heat Seeker tracking system detected the purchase of 10,500 September 15 calls for $0.25 and the sale of an equal number of September 13 puts for $0.30, resulting in a credit of $0.05. The trade accounted for almost all the options volume in the Miami-based homebuilder so far today.

If LEN pushes higher, the calls will appreciate and the puts will dwindle. The opposite will happen to the downside, so the position is similar to owning shares in the company. If it stays between those two strike prices by Sept. 16, both contracts will expire worthless.

LEN rose 5.15 percent to $14.38 in afternoon trading, and is up 12 percent in the last week. The stock found itself back to levels from last summer following the early-August selloff, but the bulls have shown unusual tenacity in the name. That has mostly taken the form of extending short-put positions as investors wagered the drop was only temporary.

The company has shown evidence of a turnaround, with better-than-expected financial results of late.

Overall options volume in the name is more than twice the average amount so far today, according to Heat Seeker.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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