MeadWestvaco bulls look for more

MeadWestvaco has quietly broken out to new highs, and now the bulls think that it will continue to run. optionMONSTER’s Heat Seeker monitoring program detected the purchase of 3,000 September 44 calls for $1.05 today. Some 1,500 June 40 calls were also sold for $2.30, but volume was below open interest in those contracts. Long calls lock in the price where a stock can be bought, allowing traders to cheaply position for potential gains. It appears the investor entered today’s session holding the June long calls and rolled the trade to the higher strike. He or she collected a small credit in the process and gained an additional three months of upside exposure while doubling the number of contracts, which will result in greater leverage if the rally intensifies. (See our Education section)

Continue Reading at OptionMonster

— Option Monster

You May Also Like

About the Author: Option Monster