As Dell tries to rebound off multi-year lows, one option trader is positioning for limited upside.
DELL is up 1.35 percent to $11.99 in midday trading. The PC maker dipped to $11.43 on Wednesday, essentially matching the three-year low last seen in August 2010. Shares were trading above $17 in March before gapping down from above $15 in late May.
A trader sold 7,500 January 14 calls for the bid price of $0.34, optionMONSTER's systems show. The volume exceeded the open interest at the beginning of the day, so this was a new position.
The calls could have been sold naked in a trade that would have an initial bearish bias but would potentially profit with the stock anywhere below $14.35 at expiration. The options could also have been sold against long shares in a covered call strategy, which would be bullish up to the strike strike but would not partake in any gains with the stock above that level. (See our Education section)
Options Trading News
Social Media
Follow optionMONSTER for news and updates
Premium Services
-
Semi-active traders looking for simple calls and spreads (5 per week).
Learn More -
Entry-to-mid level traders looking for full circle trade analysis (1 per week).
Learn More -
Tailored, one-on-one education designed and led by Jon & Pete (3 months and up)
Learn More
