Buyers can't get enough of T-Mobile
David Russell | firstname.lastname@example.org
optionMONSTER's Heat Seeker monitoring system detected frequent call buying in the wireless company in March and April, when it still was called MetroPCS Communications. It's been rampaging higher since, throwing off profits of several hundred percent again and again.
The name is lighting up our screens today, this time with buyers paying $0.49 and $0.50 for the August 22 calls. An even 2,500 of the contracts were purchased in volume that dwarfed the previous open interest of just 4 contracts.
Once again, investors have locked in a purchase price using long calls. The traders stand to enjoy significant leverage if the stock continues to climb while limiting the amount of money they can lose if it drops. (See our Education section)
TMUS is up 0.36 percent to $19.76 this afternoon and has risen 19 percent so far this year. Its name was changed on May 1 after merging with Deutsche Telekom's T-Mobile business.
Calls outnumber puts by a bullish 6-to-1 ratio so far today, according to the Heat Seeker.