Options Trading News

September 16, 2016  Fri 7:16 AM CT


A large trade is betting that upside potential is limited in Supervalu.

optionMONSTER's market scanners show that 6,056 October 5 calls were sold in one print for $0.18 yesterday. This is clearly a new position, as volume was above the strike's open interest of 5,464 contracts.

Short calls generate income and lock in the price where a stock must be sold. The trade is usually done in conjunction with long shares in a covered-call strategy, reflecting a belief that gains will be limited through expiration. (See our Education section)

SVU rose 0.43 percent to $4.66 yesterday but is down 17 percent in the last month. The supermarket chain's next quarterly results are estimated for pre-market hours on Oct. 20.

Overall option volume was 6 times greater than average in the name yesterday.

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