The options started lighting up around the noon hour yesterday as I left the “Fast Money: Half Time Report” show on CNBC. The November 20 calls traded in a hurry, with more than 5,000 hitting for $1.05 and $1.10 in just four minutes. A few of the February 2013 calls traded, as well.
Those call options (learn more) lock in the price investors must pay to buy shares, which gives them nice leverage in the event of a rally. If CenterPoint doesn’t move, however, the calls will lose value over time. If it drops, they could become worthless.
CenterPoint shares rose 0.68 percent to $20.60 yesterday, and is bouncing at its 100-day moving average. More than 7,000 calls traded versus just 50 puts. Total volume was about 14 times normal levels.
—By CNBC Contributor Pete Najarian
Additional News: Should You Invest in Energy Markets?
Additional Views: Early Buyers Target JDS Uniphase: Najarian
Options Trading School:
Pete Najarian is a professional investor, CNBC contributor, regular co-host of CNBC’s “Fast Money” and co-founder of OptionMonster.com. Najarian has no position in CNP.