Option activity in the energy sector has been unusual recently, and yesterday Halliburton joined the fray.
The August 33 calls lit up OptionMonster’s tracking systems yesterday, trading in large blocks for $0.34 up to $0.40. More than 10,000 contracts changed hands versus previous open interest of 265 contracts, so new money was definitely being put to work.
Those calls lock in the price investors must pay to buy stock in the oil-service company and will enjoy some nice leverage in the event of a rally. If it fails to go up, however, the options will expire worthless.
Halliburton shares rose 0.61 percent to $29.57 yesterday. Its quarterly stock performance has been brutal, with a drop of more than 20 percent earlier this month, but it’s been edging off those lows in the last week or so.
UBS recently recommended the name as part of an aggressive diversified stance in anticipation of reduced earnings risk, valuations, and higher oil prices. Transocean was also a favorite.
Calls outnumbered puts by almost 3 to 1 yesterday, reflecting the session’s bullish sentiment.
—By CNBC Contributor Pete Najarian
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