ZMH – Zimmer Holdings, Inc. – Shares of the manufacturer of orthopedic reconstructive implants, dental and spinal implants, trauma products and related surgical products popped up on our ‘hot by options volume’ market scanner today due to contrarian trading activity in January 2011 contract call options. Zimmer’s shares earlier fell 1.5% to an intraday low of $48.27 before improving late in the session to stand 0.6% lower on the day at $48.70 as of 3:30 pm ET. ZMH was rated new ‘market perform’ at Oppenheimer & Co. today. Despite the decline in the price of the underlying shares, one options trader took a bullish stance on the stock by purchasing approximately 8,300 calls at the January 2011 $55 strike for an average premium of $1.15 apiece. The investor is poised to profit should Zimmer Holdings’ shares jump 15.3% over the current price of $48.70 to rally above the average breakeven price of $56.15 ahead of expiration day. ZMH’s shares last traded above $56.15 back on July 16, 2010.
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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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