Paper bought the TROX Jan 8 calls for 1.825.
Tronox Ltd, trading 7.92 (up .42) with an IV30 of 94% and an HV10 of 69%, has earnings coming out on May 4.? A customer is betting that TROX is going to move higher coming out of those earrings via a ratio call roll down.? The stock has an ADV of 600 contracts and open interest of 33,000 contracts.? The customer was long about 15,000 of the Jan 10 calls, the customer rolled out of those calls selling them at 1.125 and in a close to premium neutral trade bought the Jan 8 calls for 1.825.
This trade is a customer moving his or her call location to capture more near term delta, while giving up some upside on a wicked move higher.? The customer clearly wants to stay long, but wants to have more of a shot at a move from the current price than lots of upside above 10.
This trade should be considered bullish the underlying and bearish volatility.