OptionsHouse

Options Trading News

May 9, 2013  Thu 11:08 AM CT

MWE: SEE CHART GET CHAIN FIND STRATEGIES
One investor is adjusting a bullish trade in MarkWest Energy Partners, which has gone straight since November.

optionMONSTER's Heat Seeker monitoring program detected the purchase of some 11,000 August 67.50 calls for $1.60 and the sale of some 10,400 August 62.50 calls for $3.70. Volume was below open interest in the 62.50s, which suggests that an existing long position was closed and rolled to the higher strike.

He or she collected a credit of $2.10, which probably represents their initial investment in the calls. They remain exposed to further upside, but are now risking only profits. (See our Education section for more on how options can be used to manage trades.)

MWE is up 2.29 percent to $64.73 this afternoon and 27 percent so far this year. The pipeline stock broke above its previous all-time high from 2012 in late April and has been consolidating since. Based on today's activity, the investor thinks that it will keep on running.

Pipelines have emerged as a major group within the energy sector as the domestic production surges within the United States.

Total option volume is quadruple the daily average in MWE, according to Heat Seeker. Calls outnumber puts by 54 to 1.
Share this article with your friends


Invest Like a Monster - San Diego: June 26-27

Premium Services

Archived Webinar

Education & Strategy

Short synthetic stock

With the use of the calls and puts we can not only create Long Synthetic Stock, but Short Synthetic Stock as well...

View more education articles »