Market News

October 12, 2016  Wed 8:22 AM CT

A large investor remains bullish on IBM, which will announce quarterly results after the close on Monday.

optionMONSTER's monitoring system detected the sale of 10,000 October 165 calls for $0.42 and the purchase of 10,000 November 165 calls for $0.84 yesterday. Volume was below open interest in the October contracts, indicating that a bullish position was rolled forward by a month.

Long calls lock in the price where investors can buy stock, allowing them to profit from a rally with limited capital at risk. Their cheap cost can also generate significant leverage on a percentage basis if shares move in the right direction. (See our Education section)

IBM fell 1.42 percent to $154.79 yesterday but is up 1 percent in the last month. The computing giant is scheduled to report earnings after the close on Oct. 17.

Overall option volume in the name was twice its daily average yesterday. Calls outnumbered puts by a bullish 3-to-1 ratio.

News Archives
OptionsHouse

Education & Strategy

Election Sector Rotation

Sector rotation is the process where mutual funds, portfolio managers, and investors in general, shift their investments from one sector of the economy to another.

More education articles »