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Investor raises stakes in Ashland

David Russell (david.russell@optionmonster.com)

The option activity continues to build in Ashland as the chemical producer works higher.

optionMONSTER's Heat Seeker monitoring program detected the purchase of 5,300 July 105 calls for an average premium of $3.15 yesterday. Some 4,200 April 100 calls were sold for $1.65 at the same time in volume that was below the previous open interest in that strike. This suggests that an existing position was closed, rolled to the higher strike, and increased in size.

The trade is highly bullish because the investor increased the number of long calls and put an additional $977,000 to work. Making the adjustment will also protect them against a pullback in the near term because the July contracts they own have less theta . (See our Education section)

There was also bullish call buying in the May 105 calls a week ago for $1.75. Those same contracts were bid at $1.85 yesterday.

ASH rose 1.42 percent to $99.48 yesterday and is up 7 percent in the last month. The stock has been trending steadily higher for more than two years and is now just below its previous record peak around $100 from January.

Total option volume was 6 times greater than average in the session, with calls outnumbering puts by 85 to 1.

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