Market News

November 30, 2016  Wed 8:02 AM CT

A large investor is increasing the size of a bullish position on the SPDR S&P Metals & Mining Fund.

OptionMonster's monitoring system detected the sale of 19,019 December 29 calls for $2.46 and the purchase of 40,476 December 32 calls for $0.64 and $0.65 yesterday. Volume was below open interest in the lower contracts, indicating that a bullish position was rolled to a higher strike and more than doubled in size.

Long calls lock in the price where investors can buy stock, allowing them to profit from a rally with limited capital at risk. Their cheap cost can also generate significant leverage on a percentage basis if shares move in the right direction. (See our Education section)

XME fell 1.99 percent to $31.06 yesterday but is up 27 percent in the last month. Overall option volume in the fund was 6 times greater than average, with calls outpacing puts by a bullish 18-to-1 ratio.

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