Options Trading News

June 28, 2013  Fri 12:21 PM CT

A trader is buying more time for a potential rally in food company Mondelez.

optionMONSTER's Heat Seeker detected the sale of 4,760 Weekly 29 calls that are expiring today and the purchase of 4,760 July 29 calls at the same time. The Weeklies traded for $0.10 and were below open interest, while the July options went for $0.37 against open interest of just 10 contracts.

The trader is closing the expiring calls and rolling the position, paying a net $0.27 for the adjustment. The new long calls, which lock in the purchase price for the stock no matter how far it might rise, are looking for shares to rally above $29.27 by the regular monthly July expiration three weeks from today. (See our Education section)

MDLZ is down 0.86 percent to $28.90 in afternoon trading. The stock dropped sharply with the broad market selloff last week and fell below its 200-day moving average, but shares have been trading sideways since.

The company, which is focused heavily on international markets, took its current form after spinning off its grocery business as Kraft Foods. Mondelez retained well-known snack brands, including Oreo, Ritz, Triscuits, and Wheat Thins.

Total MDLZ calls top 25,000 contracts so far today, compared to about 1,500 puts.

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