Are Symantec options too cheap?

Symantec reports earnings in a month, and one investor expects tensions to mount.

optionMONSTER's monitoring programs detected the purchase of 6,500 August 14 puts for $0.77 and 6,500 August 14 calls for $0.66. Volume was more than 45 times open interest in both strikes.

Known as a straddle , the trade cost $1.43 and is designed to profit from higher implied volatility as the July 25 release date approaches. Option premiums often increase before news events that have the potential to move the stock price. Traders can exploit the trend by purchasing both calls and puts. (See our Education section)

The last earnings report in April triggered a violent selloff after the computer-security company said it was taking longer than expected to transition to a subscription-based revenue model.

SYMC is down 2.33 percent to $13.84 in early afternoon trading, having lost almost one-quarter of its value in the last three months. Total option volume is triple the daily average so far in the session.

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