VMware releases quarterly results next week, and traders are looking for gains farther down the road.
optionMONSTER's monitoring program shows that 2,000 October 62.50 were purchased for $4.60 yesterday. This represents new positioning, as open interest in the strike was just 94 contracts before the trades occurred.
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)
VMW fell 0.31 percent to $60.96 yesterday but is up 21 percent in the last three months. The data-center infrastructure company is scheduled to announce quarterly results after the close on Monday.
Overall calls in VMW outnumbered puts by a bullish 3-to-1 ratio yesterday.
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