Options Trading News

November 29, 2012  Thu 10:06 AM CT

One investor is betting that Lowe's will keep going and going.

optionMONSTER's Heat Seeker monitoring system detected the purchase of about 10,000 December 36 calls for $0.93 and the sale of an equal number of December 34 calls for $2.36. Volume was below open interest in the 34s, indicating that an existing position was closed and rolled to the higher strike.

The investor collected a credit of $1.43, thereby recovering most of their capital locked up in the trade. He or she now remains positioned for further gains in the next three weeks if the home-improvement stock continues to rally. (See our Education section)

LOW is up 0.67 percent to $36.01 in morning trading. The stock is up 48 percent so far this year amid improved sentiment toward housing and is now making new all-time highs. Earnings and revenue beat expectations earlier this month, and management said demand for building materials was strong in the wake of Hurricane Sandy.

Total option volume is more than twice the daily average so far today, with calls outnumbering puts by 18 to 1.
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