OptionsHouse

Options Trading News

November 19, 2013  Tue 5:16 AM CT

YOKU: SEE CHART GET CHAIN FIND STRATEGIES
Youku Tudou gapped higher after reporting earnings at the end of last week, and now the bulls are looking for more.

optionMONSTER's Heat Seeker system detected steady buying in the December 34 calls, where more than 9,200 contracts traded for $0.85 to $1.40. The volume was well above the strike's previous open interest of 5,465, indicating that new positions were initiated.

These long calls lock in the price where traders can buy the stock for the next five weeks no matter how far it might climb. The contracts can provide significant leverage in a rally but will expire worthless if shares remain below $34. (See our Education section)

YOKU was up 2.56 percent to close at $30.05 yesterday. The streaming-video company, China's version of Netflix, hit a new 52-week high of $31.77 earlier in the session but fell when the rest of the broader market sold off.

Total option volume topped 33,600 contracts yesterday, 6 times its daily average for the last month. Overall calls outnumbered puts by 18 to 1, a reflection of the session's bullish sentiment.

(A version of this post appeared on InsideOptions Pro yesterday.)
Share this article with your friends


Related Stories

YOKU

Calls bet Youku will resume rally

June 16, 2015

The Beijing-based video-streaming company rebounded sharply in early April with the rest of the Chinese market, and shares have more than doubled in price since.

OptionsHouse

Premium Services

Archived Webinar

Education & Strategy

Real vs. Synthetic

We now know that there are two ways of creating a call position, a put position, and a stock position. We can simply use the actual real security or we can recreate it synthetically. We can create these positions in both long and short forms and this ability sets up an interesting scenario--an arbitrage!

View more education articles »