Large call spread targeting Tronox
Chris McKhann | [email protected]
optionMONSTER systems show that a trader bought 9,500 November 22.50 calls for $2.15 and sold the same number of November 30 calls for $0.45.
This vertical spread cost the trader $1.70, which is the amount at risk if TROX remains below $22.50 through mid-November. The maximum gain would be $5.80 if shares are at or above $30 at that expiration. (See our Education section)
TROX gained 2.48 percent to close at $21.88 yesterday, bringing it back up to resistance that has been in place since October. Shares were last above $30 in June, then fell below $15 into December.
The stock apparently did not move in after-hours trading. Management is scheduled to discuss the earnings report on a conference call today at 8:30 a.m. ET.
More than 24,000 TROX options traded on the day, compared to a daily average of just 384 in the last month.