General Cable draws contrarian play
Someone apparently thinks that the tide is turning for General Cable, which reports earnings two weeks from now.
optionMONSTER's Heat Seeker monitoring system detected the purchase of 2,000 August 32 calls for $1.40 and the sale of an equal number of August 34 calls for $0.50 this morning. That translates into a cost of $0.90.
The position will inflate to $2, or a profit of 122 percent, if the wire maker closes at or above $34 on expiration. (See our Education section for more on the strategy, known as a bullish call spread .)
BGC is up 2.14 percent to $31.94 in midday trading but has been struggling all year. It declined following its last two earnings reports amid weak revenue growth as other companies in the industry have improved, so today's trader seems to be looking for General Cable to catch up. Its next release is scheduled for Aug. 1.
Total option volume is 19 times greater than average, with calls outnumbering puts by more than 2,000 to 1.
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