Stocks quoted in this article:
The 20 stocks listed in the table below are the S&P 400 MidCap Index (MID) components that have attracted the highest total options volume during the past 10 trading days. Data is courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. One name of notable interest this morning is Advanced Micro Devices, Inc. (NYSE:AMD), which attracted the attention of put buyers last Friday.
Specifically, put volume on Advanced Micro Devices, Inc. surged to six times the norm on Friday, as the stock's steep post-earnings plunge triggered a short-selling restriction -- effectively herding bearish traders into AMD's options pits. Roughly 131,000 puts changed hands as AMD spiraled to a 16.2% loss, dwarfing the 73,000 calls that changed hands.
While some speculators were closing out their July 4 puts ahead of Friday's expiration, a fresh batch of bears bought to open August 3.50 puts on AMD. A total of 27,549 contracts were exchanged at this strike, and 25,553 translated into new open interest over the weekend. Speculators who purchased these puts are betting on a prolonged slide for AMD shares; after bottoming out at $3.67 in intraday action on Friday, the stock settled at $3.83.
Implied volatility (IV) on AMD tanked Friday following the company's earnings release, with 30-day at-the-money IV tumbling 25.2% to 47.4%. Focusing in on the August 3.50 put, IV dropped to 50.9% from 79.8% at Thursday's close.
Despite the big drop in IV, prices on those August 3.50 puts rose considerably as AMD plummeted. The volume-weighted average price on the option jumped from $0.05 at Thursday's close to $0.13 by the time Friday's closing bell sounded.
In early trading today, Advanced Micro Devices, Inc. (NYSE:AMD) is down 1.7% to trade at $3.77. The shares have lost 2.8% of their value year-to-date.