Market Overview

Dan Nathan Sees Unusual Options Activity In Wal-Mart


CNBC Options Action's Dan Nathan spoke on the show about trading activity in options market in Wal-Mart Stores, Inc. (NYSE: WMT) on Monday. He said that options volume was 4 times higher than average daily volume and 80 percent of the volume was in call options.

There was a one big trade in the morning, when the stock was trading at $79.70. A trader bought 21,000 contracts of the January 82.50 call options and paid a premium of $0.64. The trade would be profitable if the stock trades above $83.14 or 4.5 percent higher on the January expiration.

Nathan added that there are rumors that Bill Ackman is interested in Wal-Mart and traders who want to follow this rumor can use options to do so and define its risk.


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