Big bet on shares rallying through January.
On Monday, a bullish bet was made on Anheuser-Busch Inbev (BUD), maker of Budweiser and other beverages and spirits. The bet was on the January 2020 $90 call options on the stock, expiring 171 days from now.
Over 15,000 of these contracts traded, against an open interest of 1,233, making for a 12-fold surge in volume on the option.
- The ONLY Way to Play Markets Like These
Warren Buffett said, "Price is what you pay... value is what you get."
The best investor in the world knows the only way to prosper (especially in markets like these)... is to invest in VALUE.
But this $2 stock could be the last value play in the market today.
Even more unusual is the fact that shares currently trade around $101, making the option about $11 in-the-money. It should move higher penny-for-penny with shares. At a current price around $14.00, there’s only about $3 per contract in time premium, which seems like a small amount for the time involved relative to other options expiring that are also in-the-money.
Action to take: Shares of the company are near a 52-week high and seem a bit bubbly around 27 times earnings. However, the company’s high-profile brands and earnings power make it a potentially good investment over the next few months.
Shares may rise on general bullishness from an interest rate cut as early as this week, or shares may hold up as a defensive play should the rest of the market pull back. Investors could buy shares and get a 2 percent dividend, or speculate on the January $90 calls as well.