Alan Knuckman's Kroger Options Trade

Alan Knuckman of ‎Bulls Eye Option spoke on Bloomberg Markets about a bullish options trade in Kroger Co (NYSE: KR).

He wants to buy the January 2019, 25 call for $6.75. He explained that it's only $1 more expensive than the January 2018, 25 call and it gives more time for the stock to move higher. He added that Kroger Co is under pressure because low inflation has had a negative impact on its margins.

Knuckman believes inflation could increase, because he sees some improvement in the wage inflation. If that happens the stock is going to trade higher. The trade breaks even at $31.75 or 5.52 percent higher.