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Trader sees Lennar staying in range

Chris McKhann (chris.mckhann@optionmonster.com)

Lennar is pushing back toward five-year highs reached two weeks ago, but one trader sees the homebuilder's shares staying in a tight range for the next month.

optionMONSTER's systems detected a combination trade that involved 2,963 each of the December 36 puts and 38 calls. The puts went for the listed bid of $1.28 and the calls for the respective bid price of $1.43.

This short strangle position takes in $2.71, which will be the profit if LEN remains between $36 and $38 at expiration in mid-December. The trade, which is counting on lower volatility , can also generate some profit if shares are between $33.29 and $40.71. (See our Education section)

LEN is up another 2.5 percent to $37.02 after bouncing off support at $34 on Thursday. It was up at $39.33 two weeks ago.

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