Anadarko Petroleum witnessed some massive volume in the June 45 strike calls yesterday.  Even today, there is significant volume in the same June 45 strike calls.  I just initiated my own play on Anadarko, but using the strategy discussed at the following link:

Here is a static snapshot of the June option chain for Anadarko.

apc-option-chain

I initiated the following play this morning:

  • Bought the June 45 strike call
  • Financed most of the cost of it by selling the June 44 strike put
  • Note:  Other options are to sell the 45 or 46 strike puts if you are more bullish.

I executed this trade in my OptionsXpress account.  They only charge a single commission for up to 10 options of a spread contract.  Virtually every other broker would have charged 2 commissions for this order; optionsexpress only charged 1.


My margin balance requirement for the trade is $4,400 for the naked put sale.  I’m fine with having the shares put to me if Anadarko drops because I need some more oil and energy in my portfolio anyway.  And if Anadarko does go up significantly, then I will cash out my call option for a profit and look for another energy play later.

Disclaimer: This is *NOT* advice.  Trade at your own risk!