A large trader apparently believes that Spirit AeroSystems is ready to take off.
optionMONSTER's Heat Seeker monitoring program detected the purchase of 5,285 October 35 calls for $1.60 and the sale of an equal number of October 30 puts for $1. Volume was more than 35 times the previous open interest in each strike, indicatings that new positions were initiated.
The trade cost $0.60 and will behave similarly to owning shares: The long calls will appreciate if the stock moves higher, but the puts sold short will gain if it heads lower. Unlike owning shares, however, the position will track SPR less closely as time passes and expire worthless if it's still between $30 and $35 by the third Friday of October. (See our Education section)
SPR is off fractionally at $32.42 in afternoon trading. The maker of airline fuselages roughly doubled last year, only to plunge on a poor earnings report in February. The most recent set of numbers on May 2 beat expectations, and the shares gapped higher.
Overall option volume in the name is already double its full-session average today, according to the Heat Seeker, with that bullish trade accounting for more than 80 percent of the total.
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