Stocks quoted in this article:
Of the 20 equities seeing the heaviest options volume in recent sessions, three names of notable interest this afternoon are Citigroup Inc (NYSE:C), Ford Motor Company (NYSE:F), and Oracle Corporation (NASDAQ:ORCL). Here is a quick look at today's interesting activity in these options pits.
Citigroup Inc (NYSE:C) muscled its way back atop the $50 mark, and one group of speculators is betting on the stock to extend its lead north of this round number through next Friday's close. Of the 6,179 July 50 calls that have been exchanged, 64% have done so on the ask side. With implied volatility on the rise, it appears that new bullish positions are being initiated. Thanks to today's 1.1% pop that pushed C to the $50.09 mark, these calls have moved into the money. However, based on the volume-weighted average price (VWAP) of $1.02, C must land above $51.02 (strike price plus the VWAP) by the close on July 19 in order for the options to be profitable. Widening the sentiment scope reveals that long puts have been in favor in Citigroup's options pits of late. Given the equity's nearly 92% year-over-year advance, though, this penchant for puts could simply represent shareholders picking up some options-related insurance against a potential earnings-induced pullback. The financial firm is slated to take its turn in the confessional ahead of the bell next Monday.
It seems like nothing can stop Ford Motor Company (NYSE:F) these days. In addition to outpacing the broader S&P 500 Index (SPX) by more than 20 percentage points during the past three months, the stock has tacked on a cool 31.7%. The underlying strength of F was further exhibited today, when the equity tagged a fresh two-year peak of $16.94. The stock's ride higher isn't over -- at least not this week -- according to the speculators who are picking up the weekly 7/12 17-strike call for a VWAP $0.11. The majority of the 2,318 contracts traded have crossed at the ask price, and data from the International Securities Exchange (ISE) confirms a portion of today's activity is of the buy-to-open kind. Given the average cost of entry, these traders need Ford to topple $17.11 by week's end. This breakeven mark not only represents expected upside of 1.5% from F's current perch of $16.86, but territory not charted on an intraday basis since January 2011.
Oracle Corporation (NASDAQ:ORCL) has been struggling on the charts since taking a disappointing swing at the earnings plate in late June. Today's price action is no exception, with the stock down 0.4% to trade at $31.50. Option traders are refusing to capitulate to this downward price action, and, heading into the final hours of the session, ORCL's August 32 call has seen 15,220 contracts change hands. Almost all of these have gone off on the ask side, implied volatility has ticked higher, and volume exceeds current levels of open interest, suggesting a fresh batch of bullish bets is being established. The expectation for purchasing the calls for a VWAP of $0.47 is for ORCL to take out $32.47 ahead of the closing bell on Friday, Aug. 16, when back-month options expire. Should the stock fail to topple the strike price, the most the traders have on the line is the initial premium paid. Fundamentally, the stock will make the switch from trading on the Nasdaq to the New York Stock Exchange (NYSE) next Monday. As a result, Oracle will surrender its spot on the Nasdaq-100 (NDX) to Tesla Motors Inc (NASDAQ:TSLA). Additionally, the company is slated to go ex-dividend tomorrow. .
The 20 stocks below have attracted the highest options volume -- in the front three-months' series -- 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.