Options Trading News

September 14, 2012  Fri 11:16 AM CT

One investor is giving Yandex room to run.

optionMONSTER's Heat Seeker tracking system detected a surge of call volume in the Russian Internet company. Trades of 4,000 contracts each crossed in the November 21 calls for $4.30 and the November 26 calls for $1.30, but volume was below open interest. The November 25 calls were then bought for $1.80 in a new opening position.

It appears the investor previously owned a bullish call spread in the 21s and 26s, but that strategy limits their gains at the $26 level. He or she closed it and made a straight purchase of the 25 calls, which have unlimited upside potential. They recovered $1.20 of capital in the process. (See our Education section)

YNDX rose 3.37 percent to $24.88 in early afternoon trading and is up 21 percent in the last month. It's been ripping higher as investors return to emerging markets, especially Russia.

Some 14,700 contracts have traded in the name so far today, more than 76 times the daily average. Calls outnumber puts by a bullish 880-to-1 ratio.
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As I stated in last week's article, a break out or a break down needs to have a couple things happen before it is considered a confirmed break out or break down. The only problem is that in today's market where things move much more quicker than they did just a few years ago, two days could wind up being the majority of the expected movement, if not the whole movement.

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