How one trader is playing Best Buy
Chris McKhann | firstname.lastname@example.org
optionMONSTER systems show that 7,500 each of the January 42 and 48 calls traded. The 48s were bought for the ask price of $0.43, while the 42s were sold for the bid price of $1.57. The volume at both strikes was more than open interest, so this appears to be a new credit spread.
That means the trader takes in $1.14 of credit, which will be kept as profit with BBY anywhere below $42 at expiration. The maximum potential loss is $4.86 if BBY is above $48. (See our Education section)
BBY is up 1.34 percent this morning to $39.29, but that makes up for just a small part of the losses from the previous session. Shares of the electronics retailer closed at $43.56 on Monday but then gapped down after yesterday's quarterly results.
More than 28,000 BBY options have traded, topping the daily average over the last month of 21,000.