Stocks quoted in this article:
The 20 stocks listed in the table below have attracted the highest total options volume during the past 10 trading days. Names highlighted are new to the list since the last time the study was run, and data is courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. One name of notable interest today is Gilead Sciences, Inc. (NASDAQ:GILD), which has seen a mix of call selling and buying.
Gilead Sciences, Inc. is rallying early this afternoon, up 1.7% to trade at $109.39, after earlier hitting a fresh record high of $109.50. Sparking the upward move was a price-target hike to $125 from $115 at UBS.
In options land, the stock's 30-day at-the-money (ATM) implied volatility has spiked 11.1% to 33%, signaling elevated demand for short-term strikes. Calls are popular, outpacing puts by a greater than 3-to-1 margin.
Digging deeper, GILD's in-the-money November 100 call is seeing considerable action, with traders apparently securing profits by selling to close their positions. However, the most active option is the weekly 10/3 109-strike call, where roughly 5,000 contracts are on the tape. These now ATM calls are being bought to open at a volume-weighted average price (VWAP) of $3.83, signaling bullish expectations among short-term traders.
Specifically, the call buyers will profit if Gilead Sciences, Inc. (NASDAQ:GILD) is perched above $112.83 (strike plus VWAP) at the close on Friday, Oct. 3 -- when the weekly series expires. On the other hand, the most these option bulls stand to lose is the initial cash outlay, should the pharmaceutical stock close below the strike at expiration.