Options Traders Bet on Allstate Move Higher

By David Russell, reporter at OptionMonster

Some investors are wagering on a move higher for Allstate(ALL Quote) prior to the company's second-quarter earnings report after the closing bell Wednesday.

OptionMonster's tracking systems detected heavy trading Tuesday in the September 30 calls, which changed hands mostly for 40 cents to 65 cents. Volume in the strike was nearly 11 times open interest at 12,449. Although it wasn't absolutely clear that the calls were bought, most of the price action was consistent with purchases.

Allstate ended the regular session up almost 3% to $28.17, but slipped 22 cents in after-hours trading.

The property and casualty insurer needs to climb a further 9% for the calls accumulated to turn a profit. Overall options volume in the name was more than four times average, with calls outnumbering puts by six to one.