=Options Report -2-: Oracle Calls Surprisingly Active
Dow Jones News Service via Dow Jones
Elsewhere in the options markets:
It should come as no shock that Oracle options are extremely active Tuesday
after the company said late Monday that its earnings for the fiscal second
quarter that ended in November missed Wall Street's earnings targets.
But, traders said they were surprised by the number of investors willing to
make bullish bets by buying Oracle call options.
Call options give investors the right, but not the obligation, to buy the
underlying shares for a set price by a certain time.
"There are lots of people who figure this could be a cheap way to get in
before the company rebounds," said one trader at the CBOE.
Oracle's December 23.375 calls are down 6 1/16 at 1 3/16 on volume of 5,859,
compared with open interest of 4,381; the January 25 calls are down 1/16 at 1
1/2 on volume of 3,869, compared with open interest of zero; and the March 27.5
calls are down 3 13/16 at 1 15/16 on volume of 2,364, compared with open
interest of 16.
Oracle shares are down 9 13/16 at 22 9/16 on Nasdaq volume of 154.4 million
shares, compared with average daily volume of 6.8 million.
And, an investor who is long Warner-Lambert stock unwound the position by
executing a reversal with the company's April 120 put and call options,
according to a specialist at the American Stock Exchange.
The specialist said the investor sold the stock to the crowd, sold the puts
and bought the calls. In this way, the investor was able to maintain a
less-expensive bullish bet on Warner-Lambert without having to own so much
stock.
Warner-Lambert shares have been on a rocky ride since Dec. 1, when Glaxo
Wellcome suspended sales of a diabetes drug in Britain that Warner-Lambert
markets in the U.S. The stock - which fell to 114 on Dec. 1 from 139 7/8 on Nov.
28 - is down 2 3/4 Tuesday at 114 7/8.
Warner-Lambert's April 120 calls are down 2 1/8 at 8 1/8 on volume of 1,262
compared with open interest of 725, and the April 120 puts are up 1 3/4 at 12 on
volume of 1,206 compared with open interest of 468.
-By Eric Weiner; 201-938-5298
(END) DOW JONES NEWS 12-09-97
03:49 PM
-0- 3 49 PM EST 12-09-97
:TICKER: CI ORCL WLA
:SUBJECT: DRUG INSF SOFT SOPT CA NJ PA
Copyright (c) 1997 Dow Jones and Company, Inc.
Received by NewsEDGE/LAN: 12/9/97 4:48 PM |
