Trader buys time for rally in Aruba
A large trader is buying more time for a rally in Aruba Networks.
optionMONSTER's Heat Seeker system shows that a trader sold 5,200 October 17 calls for the bid price of $2.25 and bought 5,200 April 22 calls for $1.85 and $1.95 on Friday. Volume was above previous open interest in the April contracts, indicating that a position was rolled forward.
The trader is closing the October calls, which expired at the end of last week, and opened a new position six months later at a strike that is $5 higher. The new long calls, which lock in the price where shares can be purchased, are looking for a rally by mid-April but will expire worthless if the stock remains below $22.
ARUN was up 0.26 percent to $19.49 on Friday. The network-technology company had been trending lower since reaching a 52-week high of $23.90 on Sept. 12, but shares have been trading sideways with their 200-day moving average in the last week.
Friday's total option volume in the name topped 17,000 contracts, 5 times its daily average for the last month. Overall calls outnumbered puts by 17 to 1.
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