How one large bull is playing Fluor
Mike Yamamoto | firstname.lastname@example.org
A trader apparently sold 4,000 January 50 calls for $8.40 against the previous open interest of 4,424 contracts, according to optionMONSTER's systems. At the same second, he or she bought 6,000 January 57.50 calls for $3.60 against open interest of 780.
Because volume was below open interest in the first strike but not the second, it appears that the transaction was rolling a long position to a higher price. The engineering company's stock has been running up for more than a week, so the trader is selling the January 50 calls and using the money to buy even more upside options at the higher strike. (See our Education section)
The January 57.50 calls would be profitable at expiration with the stock above $61.10, a price it has not seen since April. FLR rose 2.02 percent to close at $56.99 yesterday, its eighth straight session of gains since surpassing Cabot Oil & Gas in market capitalization in the S&P 500.
Overall option volume in the name was more than 10 times its daily average. Only 609 of those were puts, reflecting the session's bullish sentiment.