What has BAC been up to? read option 14 calls june 28
Bank of America Corp (NYSE:BAC) is following in the bullish footsteps of the broader equities market today, with the stock 0.4% higher to trade at $13.25. The security's upward momentum has prompted one group of speculators to eye a move into territory not charted in two years. Specifically, 8,998 weekly 6/28 14-strike calls have changed hands, 89% of which have done so at the ask price. Implied volatility is up, and data from the International Securities Exchange (ISE) confirms that a number of positions have been bought to open. The volume-weighted average price (VWAP) for the calls is $0.02, meaning BAC must rise above $14.02 (strike plus VWAP) by next Friday's close in order for these traders to turn a profit. Should the stock fail to topple the strike, the most the traders have on the line is the initial premium paid. Although Bank of America has not traded north of $14 since March 2011, this optimistic outlook isn't out of the question, considering the stock tagged a fresh multi-year peak of $13.99 as recently as May 31. In the near term, BAC could find some options-related support atop the $13 mark, as peak put open interest in the front-month series resides at the June 13 strike. This level could translate into a foothold for the equity as the more than 72,500 contracts that rest here begin to unwind ahead of Friday's close.