On a down day in the markets, some companies are still getting some unusually large call buying attention. One such stock is Yingli Green Energy (YGE). YGE often attracts some interesting, and profitable options trades.
One trader just jumped in, buying 5,000 September $4.50 calls just a few minutes ago. The trader paid just 20 cents for those calls. That gives this bet a transaction value of $100,000.
Of course, those calls are so cheap due to the fact Yingli Green Energy (YGE) is only trading at $3.52 today, up 4 cents, on lower than average volume. This is a rather interesting and unusual trade given how far out the money the options are and the total number bought.
Besides the large volume, and OTM nature of the calls, this buy is also very interesting in that earnings were announce in June, so there appears to be no catalyst for the stock between now and September. Of course, there is always a catalyst when a trader makes a large options bet like this, so clearly something else is coming down the news pipe on Yingli Green Energy. Unlike this trader, we just don’t know what that news is yet, because it hasn’t been announced.
Yingli Green Energy (YGE) is a China based solar panel manufacturer that has traded as high as $8.77 this past year, and as low as $2.68. It could be that YGE is in play for a buyout, or maybe the Chinese government is upping the level of subsidization for all chinese solar manufacturers. Either way, this is an unusual call trade, and we may have to participate in a small way on this one. We may just buy a little now, and also pick up some of the common.