OptionsHouse

Options Trading News

April 25, 2013  Thu 3:47 AM CT

CF: SEE CHART GET CHAIN FIND STRATEGIES
Shares of CF Industries rebounded sharply yesterday, and one trader is betting on more gains ahead for the fertilizer producer.

optionMONSTER's Heat Seeker system shows that a trader bought 4,950 August 210 calls for the ask price of $2.76 and sold the same number of the August 230 calls for the bid price of $0.60. Volume was above the previous open interest at each strike, indicating new activity.

This bullish call spread cost the trader $2.16, which is the amount at risk if shares remain below $210. The maximum gain is $17.84 if the stock is above $230 by expiration in mid-August. (See our Education section)

CF climbed 4.27 percent to $187.09 yesterday after seeing its lowest prices since June last week. Shares were above $230 into the start of January.

More than 16,000 CF options traded overall yesterday, quadruple its daily average of 4,000 for the last month. 
Share this article with your friends


OptionsHouse

Premium Services

Upcoming Webinar:

How to Defend Your Portfolio and Profit in a Market Selloff

http://bit.ly/1OSMWU6

Jon Najarian and Sandy Chaikin of Chaikin Analytics demonstrate how to play defense when the market is selling off. And, how to turn misery into money, whether investing in stocks or trading options.

Education & Strategy

The sweet spot

When using the Stock Replacement Strategy, we must remember that in reality, we are doing a STOCK trade. We are just using options. We are replacing the stock position with an option position (long calls).

View more education articles »