Western Refining has been explosive, and one big investor is looking for more upside.
optionMONSTER's Heat Seeker monitoring program detected the purchase of 4,000 March 45 calls for $1.75 and the sale of an equal number of March 40 calls for $3.95. Volume was below open interest at the lower strike, so it looks like an existing trade was closed and rolled up.
Long calls lock in the price where the oil-refinery stock can be purchased, letting investors cheaply position for a rally. Adjusting the position lets them recover some of their capital while remaining exposed to further gains. In the case of Friday's trade, he or she received a credit of $2.20. (See our Education section)
WNR was unchanged at $42.42, but is up 59 percent in the last six months. It's been running along with other oil refiners, which have soundly outperformed the broader market since the end of September as shown on our researchLAB market scanner.
Total option volume was 19 times greater than average in the El Paso-based company, with calls outnumbering puts by a bullish 36-to-1 ratio.
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