C.H. Robinson Worldwide has been rallying back from long-term lows, and the bulls keep piling in.
optionMONSTER's Heat Seeker tracking system detected heavy volume in the July 62.50 calls, with large blocks trading for $0.60 to $0.65. Volume surpassed 9,000 contracts, more than triple the previous open interest, which indicates that new positions were initiated. More than 2,400 August 65 calls were also bought for $0.70.
Long calls lock in the price where investors can buy a stock, letting them cheaply position for a rally with limited risk. The contracts can also generate significant leverage if shares move in the right direction, but they can quickly lose value if the stock drops. (See our Education section)
CHRW slipped 0.15 percent yesterday to close at $61.82. The freight and logistics company traded all the way down to $50 in March, its lowest price since mid-2010, but has been rallying sharply since then along with other transportation stocks. Its last earnings report also beat expectations as management raised prices on a per-mile basis.
Total option volume in the name was 12 times greater than average in the session, with calls outnumbering puts by more than 174 to 1.
(A version of this post appeared on InsideOptions Pro yesterday.)
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.