CCJ – Cameco Corp. – Buying interest in call options on Canadian uranium producer, Cameco Corp., suggests some investors are positioning for a rally in the price of the underlying shares ahead of June expiration. Cameco’s shares are currently trading 0.60% higher on the day at $22.72 just before 10:55 am (ET). Bullish traders purchased roughly 2,475 calls at the June $24 strike for an average premium of $0.33 apiece. Investors long the calls make money if, by expiration, the firm’s shares rally 7% over the current price of $22.72 to exceed the average breakeven point to the upside at $24.33. Cameco’s shares traded above $24.33 as recently as June 3, 2010, when the stock touched an intraday high of $24.34. The uranium producer’s current 52-week high is $33.74. The demand for call options on the stock lifted CCJ’s overall reading of options implied volatility 4.5% to 42.11% just before 11:00 am (ET).
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Andrew Wilkinson is the senior market analyst at Interactive Brokers Group, where he provides daily commentary and analysis on U.S. equity options trading throughout the trading day. Andrew provides webinars designed to explain option-related trading scenarios covering futures, fixed income, forex and equities.
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