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Bulls Like Dish for the Long Term

David Russell|Writer, OptionMonster
Friday, 27 Jul 2012 | 6:34 AM ET

Dish Network

hasn’t traded at $45 since late 2007, but long-term option activity targeted that level yesterday.

OptionMonster’s tracking programs detected the purchase of 10,000 January 2014 45 calls for $1.30 yesterday against previous open interest of just 19 contracts. They’re way out in time and out of the money, but the trade’s sheer size definitely drew attention.

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Those callslock in the price investors must pay to buy shares in the satellite-television company in the next 18 months. These options can generate some nice leverage if DISH powers higher but will expire worthless without a rally. Trades such as this are popular because they allow positions to be established over long periods at minimal cost.

Dish Network shares rose 2.74 percent to $29.96 yesterday and remains trapped in the same range it's seen over the last year. The company's next earnings report is on Aug. 8 before the bell.

Overall option volume was quadruple the daily average yesterday, with calls outnumbering putsby more than 100 to 1.

—By CNBC Contributor David Russell

Additional News: Dish Drops AMC Networks as Contract Expires

Additional Views: Value Hunters Target Gold Fields: Russell

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David Russellis a reporter and writer forOptionMonster . Russell has no positions in DISH.

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