Options Trading News

February 10, 2014  Mon 12:20 PM CT

A large trader is hoping for a good number when Angie's List reports earnings this week.

optionMONSTER's Heat Seeker monitoring program detected the purchase of 4,630 February 20 calls for $0.60 and the sale of an equal number of February 22.50 calls for $0.20 today. Volume is above the previous open interest at each strike, indicating that new positions were initiated.

Known as a bullish call spread, the trade cost $0.40 and will generate a profit of 525 percent if the heavily shorted Internet stock closes at $22.50 or higher on expiration. (See our Education section for more on the trade, which lets the investor position for a rally with limited risk.)

ANGI is down 1.37 percent to $17.23 in afternoon trading. The consumer-review service cratered in early October after lowering membership fees, drifted as low as $11.88 in late November, and has been rebounding since. Quarterly results are scheduled to be announced on Wednesday afternoon.

Total option volume in ANGI is quadruple its daily average so far in the session, according to the Heat Seeker. Overall calls outnumber puts by more than 17 to 1.
Share this article with your friends


Premium Services

Education & Strategy

The art of trading

As I stated in last week's article, a break out or a break down needs to have a couple things happen before it is considered a confirmed break out or break down. The only problem is that in today's market where things move much more quicker than they did just a few years ago, two days could wind up being the majority of the expected movement, if not the whole movement.

View more education articles »