Options Trading News

October 23, 2013  Wed 9:20 AM CT

H&R Block is seeing heavy call activity this morning, but the strategies behind it are unclear.

More than 11,000 each of the November and December 29 calls have traded, according to optionMONSTER's Heat Seeker system. A trader sold 6,757 November 29 calls for $0.77 against open interest of 13,246, then sold another block of 3,666 for the same price.

At the same times, the trader bought the same size blocks of the December 29 calls for $1.37. The open interest at that strike had been just 32 contracts, so these are new positions.

The could be a new calendar spread aimed to profit from HRB being right around $29 at expiration in mid-November expiration. Alternatively, the trader could be rolling long calls by closing the November position and moving it to December to buy another month for shares to move higher. (See our Education section)

HRB is down 1.58 percent to $28.93 this morning. The tax-preparation service is off its worst levels of the session, which took it as low as $28.73. The stock was up at the high of $32 at the start of August by traded at support at $26 three weeks ago.

Just shy of 30,000 HRB options have changed hands so far today, and only a few of those are puts. That is 7 times its daily average over the last month.
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