Stocks quoted in this article:
The 20 stocks below have attracted the highest options volume during the past 10 trading days. The companies highlighted are those that are new to the list since the last time the study was run. Data is courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. Three names of notable interest this afternoon are Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX), Oracle Corporation (NYSE:ORCL), and Las Vegas Sands Corp. (NYSE:LVS).
ORCL's September 33.50 put is being sold to open today, as speculators eye a short-term floor amid the post-earnings dip. Puts are popular among LVS option traders, too, despite the stock hitting a five-year high on the heels of an upgrade. At last check, around 12,000 puts have crossed the tape on LVS, compared to the average daily volume of 10,000. Meanwhile, here is a quick look at the interesting activity in FCX's options pits.
Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX) is following the broader equities markets into the red today, with the stock down 0.3% to trade at $34.47. In FCX's options pits, though, call volume is trading at a 38% mark-up to its average intraday pace (and at a nearly 2-to-1 margin over puts). The October 35 call is the most sought-after strike on the day, where 7,774 contracts -- including one large block of 2,500 -- have changed hands for a volume-weighted average price (VWAP) of $0.81. The majority of these calls have gone off on the ask side, implied volatility has edged higher, and data from the International Securities Exchange (ISE) confirms that at least some of the day's activity is of the buy-to-open variety.
By initiating the long calls, speculators think FCX will move north of $35 by the close on Oct. 18. More specifically, the traders will begin to profit with each step above $35.81 -- the strike, plus VWAP -- the stock takes over the next four-plus weeks. Delta for the option is docked at 0.42, or 42%, meaning there is a roughly 2-in-5 chance the position will find its way into the money in the course of its lifetime. Should the security fail to topple the $35 mark -- a feat not accomplished on an intraday basis since Feb. 19 -- the call buyers will surrender the initial cash outlay as the full potential loss.
What's interesting is that FCX ran to the $34.99 mark earlier in today's session, and then retreated. Could this be due in part to the healthy amount of call open interest that resides at the September 35 strike? This out-of-the-money option holds the heftiest amount of call open interest for any overhead strike in the quickly expiring front-month series. This area could continue to serve as short-term resistance for FCX, as the more than 5,500 contracts that rest here unwind ahead of tomorrow's close.