Can anything stop Interpublic?

David Russell (
June 9, 2014

Interpublic Group has been running hard, and options have been trading fast and furious.

Last week ended with heavy call buying as investors snapped up 4,000 June 21 calls, most of which priced for $0.25. That volume was almost triple previous open interest, so new positions were clearly initiated.

Long calls lock in the price where the advertising stock can be purchased and provide cheap upside exposure. That can also result in significant leverage on a percentage basis. (See our Education section)

IPG ended Friday's session down 0.41 percent to $19.50 but is up 12 percent in the last month. It first appeared on optionMONSTER's Heat Seeker monitoring program in March as the stock pushed through a key resistance level from 2004.

The shares gapped higher on a strong earnings report in April, pulled back, and then blasted to new long-term highs, with more bullish option activity hitting last month. Several of those trades doubled or tripled in value.

Overall calls outnumbered puts in IPG by almost 9 to 1, which reflects the positive sentiment. Total option volume was slightly higher than average amounts.

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