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. Three names of notable interest this afternoon are Tesla Motors Inc (NASDAQ:TSLA), Micron Technology, Inc. (NASDAQ:MU), and AT&T Inc. (NYSE:T).
Calls are outpacing puts in Micron Technology, Inc.'s options pits today, with a healthy portion of the day's volume initiated by a debit spread strategist targeting the January 2014 series. Meanwhile, ahead of tonight's third-quarter earnings results, AT&T Inc.'s call volume is trading at 1.7 times what is typically expected. Traders are particularly fond of the weekly 10/25 35-strike call, which has emerged as the most popular contract so far. Elsewhere, amid Tesla Motors Inc's recent consolidation, one group of speculators is betting on additional downside through week's end.
Tesla Motors Inc is trading decidedly lower today, as the stock continues to retreat from its record high of $194.50, tagged on Sept. 30. At last check, the equity was down 6.5% to linger near $160.58. Put players have taken notice of the recent downtrend, per the stock's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.91. While this shows that, on an absolute basis, more calls are being bought to open over puts, the ratio ranks in the 63rd percentile of its annual range, pointing to a slightly increased appetite for bearish bets (relative to bullish) of late.
In today's session, put volume is running at a 72% mark-up to its average intraday pace. The most sought-after position thus far is TSLA's weekly 10/25 165-strike put, which has seen about 14,200 contracts change hands for a volume-weighted average price (VWAP) of $3.70. The majority of the puts have traded at the ask price, implied volatility (IV) has surged 11.8 percentage points, and volume is outstripping open interest, pointing to buy-to-open activity. Based on TSLA's current price, the puts are not only in the money, they've also breached the at-expiration breakeven rail of $161.30 (strike less the VWAP) ahead of Friday's close. In other words, today's put buyers have begun to turn a theoretical profit on their bearish bets.
Meanwhile, the electric car company is slated to take its turn in the earnings confessional after the market closes on Tuesday, Nov. 5. Demand for TSLA's options has been growing in the weeks leading up to the announcement, per the stock's 30-day, at-the-money IV, which has risen from 70.3% on Oct. 9 to its current perch at 82.6%.