Traders Like the Look of Vera Bradley

By David Russell, reporter at OptionMonster

NEW YORK -- Traders want to bag gains in women's accessories company Vera Bradley ( VRA)

OptionMonster's tracking program detected the purchase of about 3,000 December 30 calls for 70 cents to $1.05. Volume was more than 200 times open interest at the strike, indicating that new positions were initiated.

Calls lock in the price where investors can buy shares, so they can generate significant leverage in the event of a rally. If the stock doesn't move, however, they will expire worthless.

Shares rose 0.07% to $26.89 on Friday. The stock has been working its way higher since the summer and is now trying to hold support at its 200-day moving average. Short interest represents more than 40% of the float, which could potentially draw buyers to the stock.

Total option volume in the name was 18 times greater than average in the session, with calls outnumbering puts by a bullish 19-to-1 ratio.

Russell has no positions in VRA.
This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

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