How calls fit into Foot Locker position
David Russell | email@example.com
optionMONSTER's tracking systems detected a surge of activity in the August 35 calls and the September 36 calls, with more than 9,300 contracts trading in each strike. The August options were bought for $0.40 against open interest, while the September contracts were sold for $0.75.
Volume was below open interest in the earlier strike, which suggests that the trader came into the session short the those contracts. He or she then closed that position and rolled to the higher strike.
The trader now has the right to sell the shares for $1 more and earned an additional credit of $0.35. The activity is almost certainly tied to a long position in the shoe retailer. (See the discussion of covered calls in our Education section.)
FL is up 2.09 percent to $35.21 near midday and is up 90 percent in the last year. The company said earnings and revenues surpassed Wall Street estimates in its quarterly report today.
Overall option volume is 26 times greater than average so far today.