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November 7, 2012  Wed 9:17 AM CT

THC: SEE CHART GET CHAIN FIND STRATEGIES
Tenet Healthcare is jumping this morning after President Obama's reelection, but one trader sees limited gains from here.

A trader sold 5,000 November 26 calls in a single print of $1.05 when the stock was trading at $26.40, according to optionMONSTER's tracking systems. The volume was more than 10 times the open interest at the start of the session, so this is a new opening position.

The calls were almost certainly sold against a long stock position because, if it weren't, this position would have huge upside risk. Traders often sell short term in-the-money calls if they see limited further upside and would like to sell their stock, but collect a premium to do so. The call selling also gives a slight cushion to the downside. (See our Education section)

THC is up 6.09 percent to $26.47. Although the hospital operator remains below its intraday highs from the first day of this month, it is on pace for its highest close in more than a year.
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Education & Strategy

The Strike-Based Greeks

The other Greeks (Gamma, Vega, and Theta) are calculated by using month and strike data, and not by individual option. These are called strike-based Greeks. Gamma, Theta, and Vega are all strike-based Greeks

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