On CNBC's Options Action, Dan Nathan spoke about unusually high options activity in McDonald's Corporation MCD.
Options trading volume on Wednesday in McDonald's was three times higher than the average daily options volume. When the stock was trading at $119.50 a trader bought 50,000 contracts of the January 2017 125 call options for $3.15. The breakeven for the trade is at $128.15 or approximately 7 percent higher from the closing price on Wednesday.
Nathan thinks it's a good idea to limit risk with calls because there is a risk of McDonald's trading lower to its breakout level from October 2015.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.