The energy drumbeat continues today with a big upside trade in Baker Hughes.
optionMONSTER's Heat Seeker tracking program detected the purchase of 16,536 March 62.50 calls for $0.88 and the sale of an equal number of March 57.50 calls for $3.43. Volume was below previous open interest at the lower strike, which suggests that an existing position was closed and rolled higher.
The investor collected $2.55 and keeps upside exposure to the oilfield-service company through the new long calls at the higher strike. He or she probably recovered the entire investment and locked in some profits by making the adjustment. (See our Education section)
BHI is up 0.22 percent to $59.90 in afternoon trading and has risen 13 percent in the last month. Most of that rally came after results beat expectations on Jan. 21 and management issued strong guidance. There has also been repeatedly bullish call buying in the name.
Total option volume in the name is already triple its daily average so far in the session, with overall calls outnumbering puts by more than 11 to 1.
Energy has emerged as a major theme in recent weeks as investors targeted names such as National Oilwell Varco, Stone Energy, and Superior Energy Services. (See the most recent edition of Pete and Jon Najarian's Advantage Point newsletter for their bullish trade in BHI.)
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