OptionsHouse

Options Trading News

May 1, 2013  Wed 4:14 AM CT

AEO: SEE CHART GET CHAIN FIND STRATEGIES
One trader apparently believes that American Eagle Outfitters will make a sharp move higher or lower in the next few weeks.

optionMONSTER systems detected the purchase of 8,250 May 19 puts yesterady for $0.39. This is clearly a new position in the specialty retailer, as the strike's open interest was 1,764 contracts before the trade appeared.

Shortly after the puts were bought, the session's biggest block of AEO stock changed hands as 305,000 shares were bought for $19.35. The combination of stock and puts creates an overall strategy that is delta-neutral, meaning that it will profit from higher volatility and/or a big move in either direction. (See our Education section)

AEO gained 1.73 percent to close yesterday at $19.45 after bouncing off long-term support around $18.30 last week. Shares were just shy of $24 at their September highs.

More than 11,000 AEO options traded yesterday, compared to the daily average of 1,190.
Share this article with your friends


Related Stories

AEO

Investor hedging American Eagle

January 6, 2015

A new protective position is aimed at locking in recent gains in the fashion retailer, which has rebounded sharply after tumbling on earnings results a month ago.

OptionsHouse

TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Free Webinar

Option Money Machine Winter Classic

Education & Strategy

The rolling technique

In the January 7th edition of Advantage Point, we initiated the purchase of a second week-out GOOGL 535 put at...

View more education articles »