OptionsHouse

Options Trading News

February 14, 2013  Thu 9:56 AM CT

YHOO: SEE CHART GET CHAIN FIND STRATEGIES
A bearish combination trade tops the option action in Yahoo today with shares near five-year highs, though it coud be hedging a long position.

optionMONSTER systems show that a trader sold 5,000 July 24 calls for the bid price of $0.54 and bought 5,000 July 19 puts for the ask price of $0.63. The volume in the latter strike was below the previous open interest, but this appears to be a new position.

The trader spends $0.09 for the combination, which is at risk if YHOO remains between $19 and $24. On its face, the risk appears to be shares running above $24, at which point the trader would have to sell shares. But the trade could be tied to long shares as a protective collar strategy.

YHOO trades at $21.17, up fractionally on the day. The Internet giant is just off of Friday's close, which was the highest since July 2008.
Share this article with your friends


Related Stories

YHOO

Yahoo draws downside position

May 6, 2015

The Internet company is down sharply since reporting earnings on April 21, and shares fell below their 50- and 200-day moving averages last week.

Invest Like a Monster - San Diego: June 26-27

TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Archived Webinar

Education & Strategy

Long synthetic call

Long and short Synthetic stock are two of the six basic synthetic positions that exist. Number three on our list is the Synthetic Long Call...

View more education articles »