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Five Names Seeing Bullish Flow

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Consumer Staples SPDR ETF
(XLP) saw one of the largest trades of the year earlier this week when a customer paid $0.15 for 250,000 January 38 calls as shares were near $35.98. Don't be fooled by the low dollar price, the position cost the buyer $3.75 million and as XLP has lifted to $36.37 this morning, is currently worth $5 million for a handy 33% mark to market gain in three days. Exiting the trade will be tricky for the client, but we'll keep an eye on it.

Fortinet (FTNT), the network security provider, saw notably heavy call buying on Wednesday, primarily in the November 22 and October 24 lines. Thirty day IV lifted six points as well, suggesting a view that shares may be set to recover some of the $4 shed in the past two weeks.

 

FTNT Daily Contract Volume
Source: Trade Alert

 



Spectra Energy (SE) calls were busy on Wednesday as well, with 2845 contracts trading and most of those opening new positions in the December 30 calls. Average daily call volume in SE is just 800 contracts and shares are near the middle of their 52-week range ($24.67 to $32.15).

Occidental Petroleum (OXY) is seeing call buying on Thursday with 2100 upside November 12 calls, most for $3 as shares traded near $84.65. OXY's share price is in the lower end of its 52-week range ($73 to $105) and both call and put OI have been building.

 

OXY Daily Open Interest
Source: Trade Alert



RenRen (RENN), sometimes mentioned as the Chinese equivalent of Facebook (FB), saw a buyer of 7000 October 4 calls for $0.15 with shares near $3.96. The purchase could close a position opened back in June when nearly 10,000 traded for $0.85.

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At the time of publication, Henry Schwartz held no positions in the stocks or issues mentioned.


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