By David Russell, reporter at OptionMonster
NEW YORK -- State Street (STT) has been rallying along with other financials, and the bulls kept piling into the investment-management firm on Wednesday.
OptionMonster's tracking programs detected the purchase of more than 5,000 January 62.50 calls for $3.25 to $3.35. Volume was more than 60 times open interest at the strike, indicating that new positions were initiated.
These calls lock in the price where investors can buy stock. Because they cost only a fraction of the share price, the options can generate significant leverage on a percentage basis if State Street climbs over the course of the year.For example, the stock was trading for about $59.72 when those calls were purchased. It then pushed higher and ended the session up 2.14% at $60.53. Those January 62.50 calls, meanwhile, appreciated more than 10% to $3.65 in the same period. Total option volume was five times greater than average in the session, with calls accounting for a bullish 79% of the total. Russell has no positions in STT