A trader is positioning for limited gains in Cheniere Energy even as its shares rebound off recent support.
LNG is up 7 percent this afternoon to $12.69. It bounced off support at $12 again this week after doing the same last week. The liquefied natural-gas company was hit a four-year high of 18.92 in late April.
A trader sold 15,000 LNG July 16 calls for the bid price of $0.25, according to optionMONSTER's systems. The volume was 3 times the open interest, so it was a new position.
The calls could have been sold naked in a trade that would take a full profit with LNG anywhere below $16 at expiration. The options could also have been traded against an existing long position in a covered call position, which would be bullish up to that strike price but would give up any further upside with the stock above that level. (See our Education section)
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