OptionsHouse

Options Trading News

November 15, 2012  Thu 3:16 AM CT

HTZ: SEE CHART GET CHAIN FIND STRATEGIES
One investor wants to take the money and run in Hertz.

optionMONSTER's Depth Charge monitoring system detected the purchase of 11,575 March 10 puts for $0.30 and the sale of an equal number of March 13 calls for $2.25. There was barely any open interest at either strike before the trade appeared, indicating that new positions were initiated.

The investor probably owns shares in the car-rental company and is worried about a selloff. He or she collected a credit of $1.95 but will be forced to sell their stock for $13 if it's above that level on expiration. Below it, the trader will have the right to sell for $10.

This combination trade locks in a maximum exit price of $14.95 and a minimum of $11.95. See our Education Section for more on how calls and puts can be used to manage risk.)

HTZ, which has been moving sideways for the last three years, fell 1.83 percent to $14.45 yesterday. It's currently near the top of its recent trading range, which could be leading some chart watchers to expect a push lower--especially if the broader market weakens.

Total option volume in the name was 6 times greater than average yesterday, according to the Depth Charge.
Share this article with your friends


Related Stories

HTZ

Hertz draws short-term bearish plays

August 26, 2015

Traders are positioning for more downside in the car-rental giant, which hit resistance repeatedly last week and then dropped with the broader market.

OptionsHouse

Premium Services

Archived Webinar

Education & Strategy

Options Academy: Ron's Risk Calculation--A Real Life Example

It is rare that I get a chance to give a real-life, real-time example in my articles that the readers were not only following but were actually involved in at the time the event is happening. Well, that is where we are right now in our QQQ trade from last week. Let's recap the trade itself.

View more education articles »