Capitalizing on Huntsman Corporation Bull Run
04/03/2009 12:38 pm EST
Huntsman Corporation (HUN) is being targeted by bullish options bettors. On Wednesday, traders on the International Securities Exchange (ISE) bought 1,141 calls on HUN, compared to just one put. I probably don't have to do the math for you on this one, but that translates to a single-day call/put volume ratio of 1,141.
Wednesday's call frenzy was simply the extension of a recent trend on HUN. During the past ten days, investors on the ISE have bought an average of 146.5 calls for every put, which ranks higher than 95.2% of other such ratios taken during the past year. In other words, options players on the ISE have scooped up HUN's calls at a faster pace just 5% of the time in the previous 52 weeks.
In the May series, optimistic traders have set their sights on the 5-strike call.
This out-of-the-money option has 8,596 contracts in residence, establishing it as the site of peak call open interest in this back-month series. The sudden interest in the stock's calls has likely been prompted by its strong price action.
From its February 24 low of $2.03, HUN has surged more than 65% and won the support of its ten- and 20-day moving averages in the process.
By Nick Perry of Schaeffer’s Trading Floor Blog