Call Buyers Place Bets During Revlon Sell-Off

Traders could be betting on a rebound in REV shares

Mar 5, 2019 at 3:06 PM
facebook twitter linkedin


Revlon Inc (NYSE:REV) stock is selling off today after brokerage firm Jefferies pointed out data from Nielsen showing worsening sales for the cosmetics company. REV shares are trading down 17.7% at $21.05, set for its first close below the 200-day moving average since August, and options volume is running at an accelerated pace.

rev stock chart march 5

At last check, it was actually call volume that was leading the way, with roughly 800 contracts crossing so far, compared to an average daily volume of just 54. Most popular by a mile is the April 22.50 call, where data points to buy-to-open activity. If so, these traders would be betting on a rebounding from REV stock in the weeks ahead.

One group that's certainly cheering today's sell-off is short sellers. These bears control one-third of Revlon's float, and it would take them almost eight weeks to cover their positions, based on average daily trading volumes. Of course, today's sell-off has REV on the short-sale restricted list.

 

 

 

These investors are using the market's volatility to their advantage and scoring triple-digit gains on many of their trades.

Even in today's sideways bear market, this trading strategy has continued to provide consistency and profitability to a small group of investors. By using this approach, these traders are removing directional risk and still hitting triple-digit returns. If you want access to this strategy, and lower risk with higher returns sounds good to you, then don't wait another minute.

Join us now to receive our next trades the moment they come out!

 

Common mistakes options traders make
 


 


 
Special Offers from Schaeffer's Trading Partners