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Bright and early this morning, consumer goods titan Procter & Gamble (PG) was targeted by a short strangle speculator. The trader sold a block of 15,000 September 60 calls, and simultaneously sold a matching block of 15,000 September 57.50 puts. By implementing this directionally neutral strategy, the options player is wagering that PG will remain pinned between $60 and $57.50 through September expiration, which is just about one month away.iron condor posts
FeedStagnating Procter & Gamble Shares Short Strangled
Bright and early this morning, consumer goods titan Procter & Gamble (PG) was targeted by a short strangle speculator. The trader sold a block of 15,000 September 60 calls, and simultaneously sold a matching block of 15,000 September 57.50 puts. By implementing this directionally neutral strategy, the options player is wagering that PG will remain pinned between $60 and $57.50 through September expiration, which is just about one month away.Continue reading Stagnating Procter & Gamble Shares Short Strangled
Post Earnings, Biogen Idec (BIIB) Sees Unusual Options Activity
As my colleague Karla Yeh pointed out over at ONN.tv earlier today, Biogen Idec (BIIB) saw some unusual options trading in the wake of its positive earnings surprise before the bell. BIIB gapped higher at the open, jumping almost 2% out of the gate. Less than a half hour into the trading day, large blocks of roughly 4,000 contracts each traded at four March strikes: the 45-strike put, the 50-strike put, the 55-strike call, and the 60-strike call. It appears as though this investor sold the March 50/55 strangle (the 50 put and the 55 call) and simultaneously purchased the March 45/60 strangle (the 45 put and the 60 call).
A short strangle is typically employed when the investor expects the underlying instrument to stay range-bound; a long strangle is used by traders who expect a sharp move in either direction. In this case, with one of each crossing the tape as part of one strategy, it can be referred to as an iron condor.
Continue reading Post Earnings, Biogen Idec (BIIB) Sees Unusual Options Activity
Deutsche Bank Still Bullish on Best Buy
Deutsche Bank has reiterated its buy rating and a $48 price target on electronics retailer Best Buy (BBY). The price target implies expected upside of nearly 19% from BBY's closing price on Tuesday.
"BBY reported that Black Friday comps were up double digits. While we expect some slowdown from that level, store checks show that trends remain solid throughout December," wrote Deutsche Bank in a note to clients. "This, coupled with an easy comparison should enable positive high single digit comps domestically. We also believe that web sales, which were up 20% in 3Q continue to grow, which helps comps. Also, TV pricing remains relatively rational, which should help offset some of the margin decline from mix to laptops."
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