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Most Active Options Update: Intel Corporation (INTC)

Calls have been gaining in popularity on outperforming Intel Corporation

by 7/8/2014 3:05 PM
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 this afternoon is Intel Corporation (NASDAQ:INTC).

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Intel Corporation has been in rally mode since hitting its most recent low of $25.74 in mid-May, with the shares up over 19%. In today's session, although the equity is being pressured by broad-market headwinds, INTC is maintaining its perch atop the round-number $30 mark, and was last seen lingering near $30.74.

Option traders have been taking note of this technical tenacity, and over the course of the past 10 sessions, speculators on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have bought to open more than four calls for each put. What's more, the resultant call/put volume ratio of 4.25 ranks in the 95th percentile of its annual range, meaning long calls have been initiated over puts with greater rapidity just 5% of the time within the past year.

It's a similar set-up in today's trading, with calls outpacing puts by a more than 2-to-1 margin. Buy-to-open activity has been detected at the July 32 call, where 30,887 contracts have changed hands for a volume-weighted average price (VWAP) of $0.17. At-expiration breakeven at next Friday's close -- when front-month options expire -- is $32.17, or the strike plus the VWAP. Gains are theoretically unlimited with each step above here, while losses are capped at 100% of the premium paid, should INTC settle south of the strike at expiration.

Looking elsewhere reveals that the lifetime of these front-month calls encompasses Intel Corporation's (NASDAQ:INTC) quarterly earnings report, slated for release after next Tuesday's close. Following its last turn in the earnings confessional in April, the stock went on to tack on 0.6% in the subsequent session. Also on the fundamental front, INTC announced it has teamed up with Dell and Samsung to create the Open Interconnect Consortium (OIC).


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