Bulls can't get enough of Abbott Labs
For the second day in a row, traders anticipate a rally in Abbott Laboratories.
optionMONSTER's Heat Seeker monitoring program detected the purchase of more than 5,000 February 46 calls for $0.98 today. Volume was more than twice the previous open interest in the strike, which indicates that new money was put to work.
Long calls lock in the price where investors can buy a stock, positioning them to benefit from a rally for limited cost. Cheap option premiums help control risk and can produce significant leverage on a percentage basis. (See our Education section)
Today's activity follows buying yesterday in the December 46 calls , which are already up more than 30 percent. We've also had a winning trade recently AbbVie , which was spun off from ABT two years ago.
ABT is up 1.04 percent to $45.69 in afternoon trading and is in all-time record territory. The provider of medical products has been marching steadily higher for the last month despite falling on a weak revenue number in late October.
Total option volume in the name is already quadruple its full-session average so far today, according to the Heat Seeker. Overall ABT calls outnumber puts by a bullish 19-to-1 ratio.
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