Why trader is selling calls in Cabot
Chris McKhann | [email protected]
optionMONSTER systems show that a trader bought 4,722 October 40 calls for $0.04 against previous open interest of 17,787 and sold 4,722 November 40 calls for $0.59. The November contracts were above that strike's previous open interest of 1,696, so it is a new position.
This is almost certainly a roll from October to November. The calls could have been sold naked with a bearish bias, but it is also quite possible that they were traded against long shares in a covered-call position, which would be bullish only up to the strike price. (See our Education section)
COG was up fractionally on the day to close at $36.78. The stock hit a high above $40 at the start of September was below $35 last week.
More than 16,000 COG options changed hands yesterday, 3 times its daily average for the last month.