Can China Life Insurance Company Ltd. Make a Notable Move Before Friday?
China Life Insurance Company Ltd. (LFC) was a popular target in the options pits on Monday. During the course of the session, the equity saw about 3,300 calls cross the tape more than tripling its expected daily call volume and nearly 4,400 puts change hands about five times its predicted single-session put activity. In fact, one speculator couldn’t decide between the bullpen and the bears’ lair, instead employing both calls and puts to bet on a price swing in either direction for the stock. Yesterday morning, the trader purchased symmetrical blocks of July 65 calls and July 65 puts for the ask prices of $1.24 and $0.76 per contract, respectively. In other words, by buying puts and calls at the same strike, the strategist constructed a long straddle on LFC for an initial debit of $2.00 per pair of contracts. The goal of the straddle is for the shares of LFC to make one of two monstrous moves before the end of the week, when July-dated options expire. More specifically, the investor nee
