Oneok Gains as Pipelines Stay in Focus

By David Russell, reporter at OptionMonster

NEW YORK -- Pipelines have been the dominant group in the last few sessions, and Monday the bulls came back to Oneok ( OKE).

OptionMonster's tracking programs detected the purchase of about 15,000 October 52.50 calls for $1. The transaction dominated activity in a name that sees volume of fewer than 1,200 contracts in an average session.

Calls lock in the price where investors can buy shares, so they can generate significant leverage in a rally. The trades have already been working for some investors because there was also call buying in the October 50s a month ago. Those calls more than doubled by Monday's session, despite the stock climbing barely 5% in the same period.

Call buyers have increasingly targeted pipelines in the last week as awareness grows of the United States regaining its status as a major player in the energy industry. Kinder Morgan and Energy Transfer have also seen bullish option paper.

Oneok closed Monday's session up 1.66% to $48.46. Total option volume was 22 times greater than average in the name, with calls outnumbering puts by 83 to 1.

Russell has no positions in OKE.
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.

If you liked this article you might like

Quitting Paris Climate Agreement Could Spark Trade Wars Against U.S.

Morgan Stanley, Kirkland Two Busiest Dealmakers in First Quarter

This $9.3 Billion Oneok Deal Was, Almost, Was Secret

How to Trade Hot Stocks Apple, Seadrill, Advanced Micro Devices