By Jud Pyle, CFA, chief investment strategist for the Options News Network

With two weeks to go before semiconductor company LSI ( LSI) announces second-quarter earnings figures, an investor significantly boosted call volume in a rollout.

The investor sold to close 31,000 July 5 calls and simultaneously bought to open 31,000 Oct. 5 calls yesterday. The July 5 calls had a volume-weighted average price of $0.0625, and the VWAP of the Oct. 5 calls was $0.5615. The July 5 calls climbed 10 cents yesterday and are home to open interest of 35,600 contracts. The Oct. 5 calls gained 7 cents Thursday and are home to open interest of 4,800 contracts. The investor isn't yet finished with LSI, and is moving soon-to-expire July contracts out to a later-dated series.

Normal daily volume in LSI rarely exceeds 6,000 options, but this rollout helped boost yesterday's volume to 73,000 contracts across all strikes. We saw few puts change hands, but the bulk of the volume accumulated in the July 5 and Oct. 5 strikes.

LSI stock has rallied more than 110% since reaching a 52-week low of $2.45 on March 9. The investor is not necessarily looking for a significant rally, but needs these shares to expire higher than $5.60 in the August expiration month. LSI shares closed up 23 cents to $5.21. In premarket trading, LSI share are down 5 cents to $5.16.

Rolling options activity does not mean investors should stock up on LSI shares, but we could see more call-buying activity if the company's earnings beat analysts' estimates again (the company reported a 3-cent loss vs. expectations for a 4-cent loss last quarter).

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Jud Pyle is the chief investment strategist for Options News Network and the portfolio manager of TheStreet.com Options Alerts. Click here for a free trial for Options Alerts. Mr. Pyle writes regularly about options investing for TheStreet.com.
Jud Pyle, CFA, is the chief investment strategist for Options News Network. Pyle started his career in finance in 1994 as a derivative analyst with SBC Warburg. After four years with Warburg, Pyle joined PEAK6 Investments, L.P., in 1998 as an equity options trader and as chief risk officer. A native of Minneapolis, Pyle received his bachelor's degree in economics and history from Colgate University in 1994. As a trader, Pyle traded on average over 5,000 contracts per day, and over 1.2 million contracts per year. He also built the stock group for all PEAK6 Investments, L.P. hedging, which currently trades on average over 5 million shares per day, and over 1 billion shares per year. Further, from 2004-06, he managed the trading and risk management for PEAK6 Investments L.P.'s lead market-maker operation on the former PCX exchange, which traded more than 10,000 contracts per day. Pyle is the "Mad About Options" resident expert. He is also a regular contributor to "Options Physics."

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