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January 17, 2013  Thu 2:45 AM CT

A combination strategy appears to be looking for shares of E*Trade Financial to remain range-bound in the next month.

optionMONSTER systems show that 10,000 each of the February 10 calls and puts traded yesterday for $0.37 and $0.51 respectively. The volume at each strike was more than twice the previous open interest, indicating new activity.

Both sides of the combination trade were sold for their respective bid prices, making for a short straddle position that is looking for lower volatility in the online brokerage's shares. The trade would take in a maximum of $0.88 if the stock closes right at $10 at expiration on Feb. 15. (See our Education section)

ETFC rose 0.92 percent to $9.86 yesterday, just about matching its close from Sept. 14, which was the highest since early May. Shares were below $8 in mid-November.  

Total option volume in the name was 38,833 yesterday, 10 times its daily average of 3,840 in the last month. E*Trade saw bullish call buying last Friday.

(Editor's note: E*Trade is a competitor of optionMONSTER's sister company tradeMONSTER.)
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