Liberty Interactive Corporation (LINTA)
April 9, 2013
ACTIONS: Buy the LINTA Jan 2014 22 calls for $1.55 or less
Dear fellow Big Money Options Traders,
Graphically shown below is what happened in Liberty Interactive Corporation (LINTA) in the options market yesterday. The chart below shows the daily contract volume traded in puts and calls in LINTA since the beginning of the year. Clearly, yesterday’s 10,763 contract purchase of LINTA Jan 2014 22 strike calls was unusual.
The next chart shows the change in open interest in calls and puts. Yesterday’s unusual call buying had a material impact on the LINTA put/call ratio.
Company management is presenting at the Telsey Advisory Group Spring Conference today. So far, there has been not important news from the conference to lift the stock. More broadly, LINTA has recently pulled back by about 5% from its highs and its trading just above its 75-day moving average. With this strong options market signal and the attractive trading dynamics of the stock, we recommend following the option market’s lead and going long the LINTA 22 2014 leaps.
Have a good week trading.
Nick Atkeson and Andrew Houghton
Big Money Options