Markets

Can anything stop Under Armour?

Under Armour has been flying, and traders think it will continue next year.

optionMONSTER's Heat Seeker monitoring program detected the purchase of 4,000 April 120 calls for $3.90 and the sale of an equal number of April 90 puts for $7. A block of 4,300 October 85 calls was sold around the same time for $14.50 but volume was below open interest.

It appears an existing bullish position expiring next week was closed and rolled forward in time, generating a credit of $7.47 million. The long calls will profit from a rally because they lock in the price where shares can be purchased. The short puts generate income to finance the bet but also create downside risk. (See our Education section)

UA is down 1.85 percent to $98.01 but is up 43 percent since the start of January. The maker of athletic clothing has benefited from consistently strong results and a successful sponsorship of stars such as golfer Jordan Spieth and basketball player Stephen Curry. It also ripped to new record highs three weeks ago after announcing that sales will double by 2018. The next set of quarterly numbers is due the morning of Oct. 22.

Total option volume is triple the daily average so far in the session, according to the 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.

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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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