OptionsHouse

Options Trading News

December 18, 2012  Tue 10:34 AM CT

KO: SEE CHART GET CHAIN FIND STRATEGIES
A unusual long-term play is bullish on Coca-Cola.

optionMONSTER systems show that a trader sold 3,000 January 2014 35 calls for $3.52 against open interest of more than 19,000 contracts. At the same time, the trader bought 6,000 January 2015 32.5 calls for $5.91 in volume that dwarfed open interest of 821 at that strike, clearly a new position.

This could be a new diagonal call spread, with the sale of the nearer-term calls to help offset some of the cost of the longer-term calls. Or this could be rolling a long-call position lower to the later-dated contracts in response to the stock's recent declines.

KO is flat on the day at $37.50. The beverage giant was above $40 into early August but has lost ground in the last few months.
Share this article with your friends


Related Stories

KO

Traders bet on a ceiling in Coca-Cola

February 5, 2016

The beverage giant reports earnings next week, and traders apparently believe that upside potential will be limited in coming months.

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 »