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Someone’s looking for a major trucking stock to keep motoring higher.
Check out Monday’s activity in Knight-Swift Transportation (KNX), the country’s largest operator of tractor trailers:
Calls fix the price where investors can purchase a stock, so they gain value when shares rise. Their relatively low cost can generate significant leverage on a percentage basis, letting traders profit from a rally with limited capital at risk. (See our Knowledge Center.)
KNX rose 0.90 percent to $37.16 yesterday and is up 13 percent so far in July. The trucking company has had mixed results as volumes weaken this year. Still it’s managed to improve profitability and raise hopes of a strong 2020.
Monday’s option trader apparently shares some of that optimism but KNX is stuck at an old high from September. Adjusting the position gave him or her an additional month for a potential breakout.
Overall option volume was 10 times the average amount in the last month, with calls accounting for a bullish 87 percent of the total.
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