Why call seller is targeting Michael Kors
Chris McKhann | firstname.lastname@example.org
KORS is up 1.6 percent this morning to trade at $39.35. Shares of the apparel company bounced this week off support at $36, their lowest level since gapping higher in mid-February.
optionMONSTER's systems detected the sale of 2,500 June 40 calls in one print for $2.15. The volume is twice the previous open interest, so this is a new position.
The call selling is a bet that KORS won't be gain much in the next week or so. The options were likely sold against long stock in a covered call position, which would be designed to profit from a lack of movement through expiration on June 15. The trader may also be looking to exit a long stock position while collecting the premium from selling the calls.