Large call sale in Walter Energy
Call selling sees limited upside in Walter Energy.
optionMONSTER systems detected the sale of 10,000 July 6 calls were sold for the bid price of $0.25 yesterday. Open interest in the strike was just 123 contracts before the trade appeared, showing that it is a new position.
The calls weren't tied to any trading in the underlying stock, so they could have been sold naked with an initial bearish bias. But it is more likely that they were traded against long shares in a covered-call position , which would be bullish up to the $6 level but not beyond. (See our Education section)
WLT rose 4.91 percent to $5.77 yesterday. The coal producer has been trending higher from a low of $4.25 hit at the start of the month. Longer term, shares are down from a 52-week high of $19.50 set in early November.
Yesterday's call sale pushed total option volume in WLT above 64,200 contracts, 6 times its daily average for the last month.
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