IB Options Brief: Las Vegas Sands Corp. (LVS) & Vishay Intertechnology, Inc. (VSH)
LVS ñ Las Vegas Sands Corp.
One bullish options strategist may rake in big profits before the start of the New Year should shares in casino operator, Las Vegas Sands climb nearly 18.0% to top $50.00 by December expiration day. Shares in LVS surged 5.0% to an intraday high of $42.60, while implied volatility on the stock declined 14.8% to 51.67% before 1:00 pm ET.
Shares in Las Vegas Sands Corp. currently trade at a 23.0% discount to their 52-week high of $55.47 achieved back on November 5, 2010, but a debit call spread in the December contract sees that discount shrinking substantially by the end of this year.
It looks like the trader purchased around 2,000 in-the-money calls at the December $39 strike for a premium of $6.35 apiece, and sold roughly the same number of calls up at the December $50 strike at an average premium of $2.07 each. Net premium paid to initiate the transaction amounts to $4.28 per contract.
Thus, the call-spreader stands prepared to profit should shares in Las Vegas Sands increase 1.6% over todayís high of $42.60 to surpass the effective breakeven point at $43.28 by expiration in December. The investor could pocket maximum potential profits of $6.72 per contract in the event that shares in LVS soar 17.4% to exceed $50.00 at expiration day. The stock last traded above $50.00 in February.
VSH ñ Vishay Intertechnology, Inc.
Technology stocks are leading the market higher today, and electronic components manufacturer Vishay Intertechnology is joining in on the rally. The stock popped up on our scanners this morning due to heavier-than-usual activity in its call options, with shares in the name climbing as much as 5.15% to $10.39 in the first half of the trading session. Call volume swelled in the January 2012 contract, where traders appear to be positioning for shares in VSH to extend gains through the start of next year.
Investors picked up around 359 calls at the Jan. 2012 $10 strike for a premium of $1.74 apiece, and purchased another 346 calls up at the Jan. 2012 $15 strike at a premium of $0.35 each. But, trading traffic is heaviest at the Jan. 2012 $12.5 strike where more than 3,200 calls changed hands against previously existing open interest of just 217 contracts.
It looks like most of the calls were purchased for an average premium of $0.82 apiece. Call buyers profit at expiration next year if shares in Vishay surge 28.2% to surpass the breakeven price of $13.32. Shares in VSH last traded above $13.32 at the beginning of August. The stock, at its current price of $10.39, trades at a 46.3% discount from its 52-week high of $19.36 set back on May 2.
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