Bulls come back for seconds in Dish
David Russell | email@example.com
optionMONSTER's Heat Seeker monitoring program detected the purchase of 6,000 January 38 calls for $1.05. Some 4,000 January 36 calls were sold for $1.85 at the same time, plus 2,000 January 37 calls for $1.35, but volume was below open interest in both of those strikes. The overall activity indicates that existing long positions were closed and rolled up to the January 38s.
The investor collected a credit of $380,000 and will make money on the January 38 calls if the satellite-television stock continues to rally. He or she apparently opened long positions at an earlier date in the lower strikes and now wants to recover some of the capital. (See our Education section for more on how options can be used to manage trades.)
DISH fell 1.25 percent to $36.21 yesterday. The stock is up 34 percent in the last six months and back near its highest price since late 2007. Its last earnings report in November indicated that the company was doing a better job retaining subscribers, and option traders chalked up massive gains in the name in October.
More than 18,000 DISH contracts traded overall yesterday, compared with an average of about 4,000 in a typical session. Calls outnumbered puts by 26 to 1, according to the Heat Seeker.