(The following is an example of notable trading cited on optionMONSTER's InsideOptions Pro service yesterday.)
Traders are betting on a breakout at Penn National Gaming.
optionMONSTER's Heat Seeker tracking program shows that about 2,100 November 18 calls were bought yesterday, most of which priced for $0.90 to $1. Volume was more than twice open interest at the strike, which indicates that new money was put to work.
Long calls lock in the price where investors can purchase shares, letting them profit from a rally with limited capital at risk. Their cheap cost can also generate significant leverage on a percentage basis. (See our Education section)
PENN rose 4.03 percent to $18.57 yesterday and is up 10 percent in the last week. It's now back above its 50-day moving average for the first time since August. The company has fared better than larger casino stocks like Las Vegas Sands and MGM Resorts. Earnings are due Oct. 22.
Total option volume was 8 times greater than average in the session, with not a single put trading all day.
More From optionMONSTER