Options Trading News

August 8, 2013  Thu 3:16 AM CT

Broadridge Financial attracted bullish option activity yesterday ahead of its earnings report this morning.

optionMONSTER's Heat Seeker system detected bullish trading in the September 30 calls, where more 1,341 contracts changed hands above previous open interest as premiums rose from $0.35 to $0.55. The calls made up almost all of the day's option volume in BR, which saw only 4 puts trade.

These long calls, which lock in the price where traders can buy shares, are looking for Broadbridge to rally above $30 by mid-September. But if BR remains below that level, the options will expire worthless unless they are sold before then. (See our Education section)

BR fell 0.72 percent to $28.98 yesterday, not far from an all-time high of $29.88 reached a week ago. The financial-technology services company, which rarely sees unusual option trading, is scheduled to announce quarterly results today before the market opens.
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The covered call and unhedged risk

I have written a few things on the Covered Call Strategy over the last two weeks. Please understand that those two previous articles plus this one do not constitute a proper, fully in-depth lesson on the Covered Call Strategy like we have in our classes at Option Monster Education. I have picked out a few topics that I believe were worth noting and today I am going to add the final one.

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