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AngloGold Ashanti draws call spread

Chris McKhann (chris.mckhann@optionmonster.com)

AngloGold Ashanti continues to try to climb off lows, and a call spread this morning sees further--though limited--gains ahead for the South African miner.

Following on a big put purchase yesterday , AU option volume tops 5,500 contracts today and is already more than twice its daily average. The activity is concentrated in a one call spread.  

optionMONSTER's Heat Seeker system shows that a trader bought 2,500 September 15 calls for the ask price of $0.60 and sold the same number of September 16 calls for the bid price of $0.30. The respective open interests were just 22 and 30 contracts at these strikes, so this is clearly new positioning.

The trader pays $0.30 to establish this vertical spread , which is the maximum amount at risk. The position can potentially earn $0.70 if shares are above $16--a 233 percent return on a 14 percent stock move. (See our Education section)

AU is up 2.33 percent this morning to $14.06 after hitting a low of $12.33 last week. Shares have been trending lower from above $36 last September and were above $16 five weeks ago. 

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