U.S. Markets closed

Investor looks for Jive to break out

Mike Yamamoto (mike.yamamoto@optionmonster.com)

Jive Software has lost more than 50 percent of its market value in the last year, but one trader is looking for the stock to rebound in the next six months.

optionMONSTER's tracking systems detected the purchase of about 2,200 January 9 calls for $0.95 to $1.05 in volume above previous open interest. About the same time, 2,000 January 7.50 puts were sold for $0.80.

This combination trade is highly bullish because a rally would boost the premiums of the long calls while reducing the value of the puts that were sold. But the opposite would occur on a pullback, and the trader would be on the hook to buy shares if they fall below $7.50 because of the short puts . (See our Education section)

JIVE rose 2.34 percent to close at $8.31 on Friday, just off its session high. The stock gapped down from above $18 a year ago, but shares have been range-bound mostly between $7 and $8.50 since mid-February. The company makes software that helps businesses learn more about their customers.

Friday's combination play made up almost all of the option volume in the name, which was more than 5 times its daily average for the last month.

More From optionMONSTER