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Option Brief: Today, Ford Motor Company (NYSE:F) announced the commencement of a new warranty that covers all Ford Genuine and Motorcraft service parts for two years from the moment of their purchase -- regardless of mileage. Meanwhile, in the options pits, about 84,000 calls have traded, outpacing the typical intraday volume by greater than a twofold margin.
The most active option is F's January 2014 18-strike call, which has seen approximately 59,000 contracts cross the tape. Data from Trade-Alert suggests the vast majority of these calls were bought to open, and that theory is confirmed by intraday stats from the International Securities Exchange (ISE). From a broader view, call buying has become the norm on F; during the past 10 sessions, speculators on the ISE, Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have bought to open 5.73 calls for every put on the automaker. This ratio ranks above 96% of others taken during the past year, as traders have rarely favored bullish bets over bearish by a wider margin.
Taking a step back, Ford Motor Company (NYSE:F) has been a technical standout. The shares have increased more than 50% during the past 52 weeks, roughly doubling the performance of the broader S&P 500 Index (SPX). At last check, the stock was sitting at $16.97.