Stocks quoted in this article:
The 20 stocks below have attracted the highest options volume -- in the front three-months' series -- during the past five 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 Ford Motor Company (NYSE:F), Apple Inc. (NASDAQ:AAPL), and Netflix, Inc. (NASDAQ:NFLX).
AAPL is wallowing in red ink today, following this morning's round of bearish brokerage notes. However, a number of speculators are betting on a quick rebound by week's end, and are buying to open the weekly 9/13 470-strike call. Meanwhile, although NFLX ran to a fresh record peak of $314.18 earlier, 1.31 puts have changed hands for every call. Elsewhere, here is a quick look at the interesting activity in F's options pits.
Ford Motor Company (NYSE:F) is seeing a rare uptick in put activity today. At last check, roughly 22,000 puts had crossed the tape, representing a 21% mark-up to its average intraday volume. By comparison, around 20,000 calls had been exchanged. The most sought-after strike thus far is the September 15 put, which has seen 5,704 contracts change hands -- including two large blocks that account for nearly half of the volume. Almost all of these puts have gone off on the ask side, implied volatility is higher, and data from the International Securities Exchange (ISE) confirms that at least some of this activity is of the buy-to-open kind.
By purchasing the deep out-of-the-money (OTM) puts for a volume-weighted average price (VWAP) of $0.02, the speculators will begin to profit with each step south of $14.98 (strike less the VWAP) F takes through the close on Sept. 20. This breakeven mark sits more than 14% below Ford's current perch at $17.50. The options market isn't too confident this put will find its way into the money during the course of its lifetime, as delta for the option is docked at negative 0.01, or 1%. Should F fail to breach the $15 mark over the next seven-plus sessions, the most today's put buyers have risked is the modest premium paid. As a point of reference, F has not traded south of $15 on an intraday basis since June 25.
As touched upon, the overriding inclination in Ford Motor's options pits has been of the bullish nature, which isn't surprising considering F has tacked on more than 72% over the past 52 weeks. In light of this, today's penchant for such a deep OTM put could simply represent shareholders using puts to protect against any near-term downside. Now appears to be an opportune time to do so, as the stock's Schaeffer's Volatility Index (SVI) of 22% ranks in the 16th percentile of its annual range. In other words, F's short-term options are inexpensive, relatively speaking.