Jon Najarian has spotted unusual options action in Green Mountain Coffee - the hot stock that's over 175% higher year to date. You read that right - over 175% higher.
What does he make of the activity?
According to the OptionMonster big institutional investors are selling the October $82.50 puts and using the proceeds to buy the November 100 calls.
”It’s a bullish bet - one that suggests Green Mountain won’t go below 82.50 but instead is more likely to trade above $100 by the third week in November,” he explains.
And it’s not the first time institutional investors have put on this kind of trade. ”They’ve done it before and it’s rewarded them many times,” he says.
WILDCARD FOR RECOVERY: CHINA?
The traders were also talking China on Friday amid concerns about growth. Is China’s economy poised for a hard landing?
David Riedel of Riedel Research Group tells us although he expects a slowdown he does not anticipate a meltdown. "Beijing has a lot of dry powder," he says. "They have huge reserves and the ability to implement stimulus where they need it."
Riedel thinks its not too late to put money to work in China. "I really like China Mobile," he says. "It's a high quality management team with $50 billion on the balance sheet."
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