AMR Corp American Airlines
Call options on the parent company of American Airlines are flying off the shelves. AMR's shares are up. Optimism on AMR Corp., as well as a number of other carriers, follows Southwest's decision to purchase AirTran for $1.4 billion in cash and stock.
- Traders gravitated to the November $7.0 strike where more than 31,000 call options changed hands versus previously existing open interest of 14,043 lots.
- Most of the contracts, roughly 25,000 calls, were purchased outright at an average premium of $0.43 apiece.
This is a typical play using an announcement as the building block for movement up as the Airline Industry is now making money. With the announcement of earnings coming later in October and investors are expecting a good report, the anticipation to jump on the bull train is very hot right now!