Community Health Systems has been trying to climb after steep losses in the last year, and traders are looking for the recent uptrend to continue.
optionMONSTER's monitoring program shows that 2,700 April 19 calls were purchased for $0.45 to $0.50 yesterday. Volume surpassed the strike's open interest of 1,055 contracts, indicating that new money was put to work, and follows buying in the April 16 calls about three weeks ago.
Long calls lock in the price where investors can buy stock, allowing them to profit from a rally with limited capital at risk. Their cheap cost can also generate significant leverage on a percentage basis if shares move in the right direction. (See our Education section)
CYH rose 1.58 percent to $18.62 yesterday. Shares are down more than 64 percent in the last year but have bounced about 9 percent in the last month.
The hospital operator reported bearish results on Feb. 15 and is expected to announce its next quarterly numbers after the close on May 2.
Overall option volume in the name was twice its daily average yesterday. Calls outnumbered puts by a bullish 64-to-1 ratio.
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