Large trader rings up calls in Vringo
Chris McKhann | firstname.lastname@example.org
Nearly 30,000 VRNG options have traded this morning, compared to a daily average of fewer than 4,000 in the last month. Most of the action is in a three-way call spread.
A trader sold 4,000 January 4 calls for $0.19 against open interest of more than 10,000, according to optionMONSTER systems. At the same time, he or she bought 4,000 May 4.50 calls for $0.66 and sold 4,000 May 8 calls for $0.20 in volume that was above the open interest in both of those strikes, indicating new activity.
This trader is selling the out-of-the money January calls, which expire in two weeks, and using the proceeds to help pay for a new call vertical spread in May. (See our Education section)
VRNG is trading at $3.59, off its morning high of $3.83 but still up 2.57 percent a day after breaking above its 200-day moving average. Shares bounced off support around $2.65 last week and are now back to where they were trading in late November.