Lower volatility seen in OfficeMax
A trader is using stock and options to bet that OfficeMax will remain range-bound in coming months.
According to optionMONSTER systems, 2,500 October 11 calls were bought for $0.55 with no open interest at that strike, so it was a new position. Less than a minute later 125,000 INTC shares were sold for $10.87.
Combined with the long calls , this creates a delta-neutral play that is counting on lower volatility . That means the trader is looking for shares to continue trading sideways and/or for actual volatility to be less than that implied by the option premium. (See our Education section)
OMX was up 1.8 percent on the day to finish at $10.94. The office-supply retailer has been trapped between $10 and $12 since gapping down in early June.
More From optionMONSTER
