Friday, November 13, 2009

Traders Gravitate Toward Bullish Bets on Potash Corp. (POT)

From Schaeffer's Research:

Calls are slowly gaining popularity over puts on Potash Corp. (POT). On Thursday, speculators on the International Securities Exchange (ISE) bought to open 4,565 calls on POT, compared to 2,578 puts. The stock's single-day call/put volume ratio checked in at 1.77, confirming that nearly two times more calls than puts were purchased during the course of the session.

POT price chartAs a result, POT's 10-day ISE call/put volume ratio now stands at 1.48, as traders have easily snapped up more calls than puts during the past two weeks. This ratio ranks in the 62nd annual percentile, which points to a growing bullish bias among option traders on the ISE.

In the same vein, POT's Schaeffer's put/call open interest ratio (SOIR) weighs in at a slim 0.62, in the 24th annual percentile. In other words, short-term traders have been more optimistically aligned just 24% of the time during the past year....MORE