ORCL – Oracle Corporation – The world’s second-largest software maker attracted call buying options investors in the first half of the trading session despite the 0.75% decline in the price of its shares to $23.03. Oracle’s shares are perhaps weaker on news the firm faces a lawsuit initiated by a whistleblower and the U.S. Justice Department alleging the software company overcharged the government by tens of millions of dollars. Options activity on the stock, however, was dominated by investors positioning for a rebound in Oracle’s share price by July expiration. It looks like optimists purchased some 5,000 calls at the July $24 strike for an average premium of $0.34 per contract. Call buyers at this strike price are poised to profit as long as ORCL shares rally 5.7% to exceed the average breakeven point to the upside at $24.34 by expiration day next month.
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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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