OptionsHouse

Options Trading News

November 29, 2013  Fri 10:38 AM CT

MMM: SEE CHART GET CHAIN FIND STRATEGIES
A large trader is looking for a big move in 3M.

optionMONSTER's trade scanners detected the purchase of 8,000 December 130 puts for $0.63 and 8,000 December 135 calls for $1.19. Volume was more than triple the previous open interest at each strike, indicating that new positions were implemented.

The investor paid $1.82 to initiate the trade, known as a strangle. He or she stands to profit from increased volatility, which would drive up the value of the industrial conglomerate's options. Alternatively, they will make money if the shares close below $128.18 or above $136.82 on expiration. (See our Education section)

MMM is up 0.2 percent to $133.77 today. The shares are up 44 percent so far this year, making them the fourth-best performing member of the Dow Jones Industrial Average. It's been climbing amid strong earnings and as an improving economy draws investors to industrial stocks.

Total option volume is slightly above average so far in the session, with that strangle dominating activity.
Share this article with your friends


Related Stories

MMM

Cramer: Avoid the sucker's game

July 10, 2015

We are in earnings season, and the dollar is going in the wrong direction--which makes a huge percentage of the stocks that rallied big yesterday morning just plain wrong.

OptionsHouse

Premium Services

Archived Webinar

Education & Strategy

Options Academy: At the Break

So far, my articles have taken you through a logical progression of option theory and fundamental concepts of options. As of yet, I have not mentioned a single strategy and for a good reason! The actual application of a strategy should come AFTER you learn about the option product itself.

View more education articles »