Call sale sees cap in Laredo Petroleum
Laredo Petroleum has surged more than 50 percent in the last month, but one trader is betting that further gains will be limited.
optionMONSTER's tracking programs detected the sale of 2,365 May 12 call for $0.80 and $0.85 at the same second yesterday. Volume was more than 6 times the open interest in the strike, showing that this is a new position.
Short calls generate income and lock in the price where a stock must be sold. The trade is usually done in conjunction with long shares in a covered-call strategy, reflecting a belief upside will be limited through expiration. (See our Education section)
LPI fell 0.49 percent to $12.12 yesterday but is up 57 percent in the last three months. The oil and gas developer is scheduled to report earnings after the market closes tomorrow.
Overall option volume was 6 times greater than average in the name yesterday.
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