Dish calls look for holiday rally
An investor is betting on a rally in Dish Network by Thanksgiving.
optionMONSTER's Heat Seeker shows that 2,000 November 65 calls were bought for $2 while 2,000 November 55 puts were sold for $1.95 yesterday. Volume was well above the open interest in both strikes, indicating that these are new positions.
This combination trade is highly bullish because a rally would boost the price of the long calls while decreasing the value of the puts that were sold . But the opposite will occur if the stock drops, and the trader will be on the hook to buy shares if they fall below $55 by expiration in mid-November. (See our Education section)
The trade follows buying in the October 65 calls a week ago .
DISH fell 1.35 percent to $59.94 yesterday. The satellite network fell from the $68 level in early August despite beating expectations on the top and bottom lines. It bounced from lows under $55 in last month's market plunge but hit resistance just below $63 in the last week.
Total option volume in the name reached 10,400 yesterday, more than quadruple its daily average for the last month. Overall calls eclipsed puts by nearly 2 to 1.
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