Wednesday, August 10, 2011

Trade of the Day: Suncor Energy (SU) Bull Risk Reversal

The Trade:
A trader bought 3,250x December $35/$25 bull risk reversals at $0.56, or $182,000.

The trader is buying upside exposure in the Energy name. SU closed trading today at $31.30. SU has dropped 21% the previous week and 23% in the previous month. SU is currently trading just above its 52-week low of $29.15. The spread has unlimited risk to zero and unlimited profit potential to the upside.

The white line shown in the SU daily stock chart is the strike price of the long call.

*Special thanks to Option Radar, BMO Capital, MEB Options, Bloomberg, Reuters, Optionistics, LiveVolPro, CBOE, AMEX, Option Monster, T.O.P. group, and all of the options desks and traders we work with to provide the option flow!

No position at this time. Position declarations are believed to be accurate at time of writing but may change at any time and without notice.

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