Bulls Come Back to SAIC
By Pete Najarian, co-founder of OptionMonster
NEW YORK -- For the second day in a row, SAIC (SAI) attracted bullish attention in the option market.
On Monday, traders were rolling calls to November from August, buying more time for upside positions. On Tuesday, OptionMonster's tracking systems detected another roll, this time from the August 14 calls to the September 15s, which were bought for 45 cents as more than 6,000 contracts traded at each strike.
These calls lock in the price where shares can be purchased, providing investors with cheap leverage in the event of a rally while limiting risk. The contracts could expire worthless if the stock doesn't rise enough, but traders would lose much less money than owning shares in a steep drop.SAIC rose 0.21% to $14.63 on Tuesday. The cybersecurity company provides scientific, engineering, and technical services to the various Pentagon agencies. Almost 20,000 options traded in the name Tuesday. All but 138 of them were calls, reflecting the bullish sentiment in the session. Najarian owns SAI calls.
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