Mako Surgical has bounced back hard after the recent selloff, and one investor is adjusting a hedged position.
optionMONSTER's tracking programs detected the purchase of 2,300 August 30 calls for $2.65 against existing open interest. An equal number of September 30 calls were sold at the same time for $3.35.
The investor probably owns the medical-device stock and has been short the calls as a way to earn income. By rolling the position today, he or she collected an incremental $0.70 of income and agreed to remain in the trade for an additional month. (See our Education section)
MAKO is up 0.22 percent to $31.82 in midday trading. It more than tripled between last November and May as use of its robotic-surgical machines spread, but has been consolidating its gains since then.
Today's trade is noteworthy because the investor is using in-the-money contracts, which reduces their risk of loss but also results in smaller potential profit. He or she is probably hoping that the shares will continue to advance and is using that belief to generate an income stream from selling options.
Overall option volume in MAKO is almost 3 times the daily average, with calls outnumbering puts by 17 to 1.
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