Tuesday October 27, 04:34 PM
STOCKS NEWS US-Xerox option trade suggests bet on rebound
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Real (Frankfurt: BJU.F - news) -time Equity news
U.S. stock market report
1208 ET 27Oct2009-Xerox (NYSE: XRX - news) trade suggests bet on rebound-analyst
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At least one option investor appears to be betting on a rebound in Xerox
Corp as the shares of the supplier of digital printer and document
management services slipped 5 cents to $7.72 near midday.
'The options paper is decidedly bullish, however, as we see three blocks of
5,000 contracts each of the December $9 calls bought for 15 cents in a matter
of minutes,' said optionMonster analyst Chris McKhann in comments on the firm's
website. The volume was nearly double the contracts outstanding in the strike
price, and thus, new opening positions were initiated, he said. McKhann noted
the stock gapped down in late September, falling from $9 to below $8. 'This
trade is a cheap shot, betting on Xerox to close that gap in before the end of
the year,' he said. If followed, it should be viewed as a small-sized bet.
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