URI Call Traders Score Big Gains in 5 Days

Plus, relatively low volatility expectations were being priced into short-term URI options

by Emma Duncan

Published on Nov 7, 2019 at 1:11 PM

Subscribers to Schaeffer's Weekly Options Countdown service just scored a nice profit on the United Rentals, Inc. (NYSE:URI) weekly 11/1 132-strike call. Below, we'll explain why we expected a big surge from URI, and how the winning trade unfolded in just one week.

At the time of our initial recommendation on Sunday, Oct. 27, URI had moved just moved higher post-earnings, even after the company narrowed its full-year guidance and lowered its EBITDA projections, hinting at excessive pessimism surrounding the stock. The shares --- which were up 32% year-to-date -- had just taken out resistance at the $130 level, which had the possibility to act as support going forward, and the week prior, formed a bullish engulfing candle.

Options were also attractively priced at the moment. URI's Schaeffer's Volatility Index (SVI) of 32% ranked lower than 91% of similar readings in the past year, suggesting relatively low volatility expectations were being priced into short-term options.

Additionally, the equity had been an attractive target for premium buyers over the last 12 months. This was per its elevated Schaeffer's Volatility Scorecard (SVS) reading of 100.

We entered the position on Monday, Oct. 28, with URI trading around the $135 mark. The stock continued higher, rallying alongside the broader equities market on upbeat U.S.-China trade headlines. On Friday, Nov. 1, the security gapped as much as 6.3% higher in intraday trading, allowing subscribers to close out of their positions and lock in a 105% profit in just five days.

Daily URI with Highlight and Entry Exit Dates


a schaeffer's exclusive


5 tips to leverage profits in this FREE insider report!



NEW! Explore Schaeffer’s Partners' deals and get connected to top online brokerages with deals tailored exclusively for our readers.  Get answers to your questions regarding transfer fees, commission rates, programs and available discounts related to online trading services.

MORE | MARKETstories

The IRS Loopholes Retirees Need to Know
Click to continue to advertiser's site.
Options Traders Blast SDC amd GOOS Stocks
SDC and GOOS options volume has ramped up today
Alibaba Stock Drops Amid Hong Kong IPO Buzz
Alibaba expects to raise up to $15 billion in its Hong Kong IPO
IRA/401K Investment Guide: 2019 Stock Market Crash
Use gold to protect any IRA, 401(k), or retirement account from a looming financial crisis.