Market News

October 17, 2016  Mon 7:16 AM CT

International Paper is drawing a highly bullish trade.

optionMONSTER's tracking program shows that 3,000 Weekly 47.50 calls were purchased for $0.78 to $0.86 while 3,000 November 44 puts were sold for $0.77 to $0.82 on Friday. These are new positions, as volume was far above the open interest in both strikes.

This combination trade is especially bullish because a rally would boost the price of the long calls while decreasing the value of the puts that were sold. But the opposite will occur if the stock drops, and the trader will be on the hook to buy shares if they fall below $44 by expiration. (See our Education section)

IP rose 1.99 percent to $46.73 on Friday but is down 4 percent in the last month. The paper and packaging company is scheduled to announce quarterly results in pre-market hours on Oct. 27.

Overall option volume in the name was twice its daily average on Friday.

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