by Houghton and Atkeson 07/24/08
Fred's (FRED) is a discount general merchandise chain store primarily based in the Southeastern United States. The stock is up about 35% year-to-date on better earnings and same store sales reports.
Options investors are betting these positive reports will continue as they purchased almost 2,000 FRED Nov 12.50 Calls (FMUKV) Wednesday for $1.70. This single option transaction doubled the number of all open contracts in both puts and calls for all of FRED's expirations. There are now about 3,000 call and 1,000 put contracts open.
FRED is not scheduled to report earnings again until Aug. 28.
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