Markets

W.R. Grace gets a vote of confidence

W.R. Grace has been working its way higher, and investors apparently think that pullbacks will be bought.

optionMONSTER's tracking systems detected the sale of about 4,500 January 40 puts for $0.25 and $0.30. Volume was more than triple open interest in the strike when the session began.

Selling puts obligates traders to buy GRA shares for $40 if they fall to that level. If they don't, the options will expire worthless and the trader will keep the premium. The strategy is frequently used by investors who like a stock but don't want to expend capital getting long.

GRA fell 1.44 percent to $44.40 yesterday but is up more than 30 percent since the beginning of the fourth quarter. The Maryland-based chemicals company has consistently reported strong earnings as it raises prices and enjoys strong demand from Latin America, where its products are used in construction projects. (See researchLAB for more)

The next release is scheduled for the morning of Feb. 1. Overall option volume yesterday was 15 times greater than average in the session.

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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