Bulls target Intrepid Potash
September 2, 2009 Wed 9:27 AM CT
Options action turned bullish on Intrepid Potash today as investors look for the fertilizer company to rally over the next three weeks.
Our Heat Seeker tracking program detected new money flowing into September call contracts. The September 25 strikes were the busiest, trading 4,446 times against open interest of 1,402 contracts. Purchases for $0.25 to $0.40 accounted for the bulk of the activity.
IPI rose 0.89 percent to $22.68 in morning trading but is down 11 percent in the last month. The stock needs to rally about 13 percent by expiration for the calls to turn a profit. There don't appear to be any scheduled events between now and then that could serve as a catalyst for the shares.
Other investors piled into the September 24 calls, with institutional-size trades detected in the $0.45-$0.55 price range. New money also flowed into the September 21 calls, which traded for $1.60 to $2. Volume in both strikes was above open interest.
Overall options volume in the name was almost four times average, with the nearest-month calls accounting for 85 percent of the activity.
(Chart courtesy of tradeMONSTER)
By: David Russell