Traders are turning bullish on Tronox before it reports earnings next week.
OptionMonster's tracking systems showed accelerated buying in the November 22.50 calls yesterday as premiums climbed from $1.10 to $1.45. More than 2,900 contracts traded in volume above the strike's previous open interest of 2,329, indicating new activity.
Calls lock in the price where shares can be purchased no matter how far they might rise. Traders use them as a less expensive alternative to buying shares directly, getting the potential leverage provided by options while limiting the amount of money at risk if the stock heads south.