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Option Clips: Molycorp Inc, Nokia Corporation, and Sprint Corporation

Reviewing notable options activity on Molycorp Inc, Nokia Corporation (ADR), and Sprint Corporation

by 12/27/2013 3:05 PM
Stocks quoted in this article:

Three equities drawing attention from options traders today are rare earths miner Molycorp Inc (NYSE:MCP), as well as telecom names Nokia Corporation (ADR) (NYSE:NOK) and Sprint Corporation (NYSE:S). Here's a look at how traders have been aligning their speculative bets today.

  • Molycorp Inc (NYSE:MCP) has rallied 15.2% today to $5.54 on no apparent news, and not surprisingly, call volume has soared to nearly 11 times its average intraday pace. By the numbers, around 60,000 calls have changed hands thus far, compared to roughly 13,000 puts. The out-of-the-money January 2014 6-strike call is the most active, where the majority of the 11,209 contracts traded have done so on the ask side. The volume-weighted average price for the calls is $0.10 apiece, which is the maximum amount today's call buyers will lose if MCP fails to topple the $6 mark over the next several weeks.

  • Nokia Corporation (ADR) (NYSE:NOK) is higher today, following reports the telecom concern pulled its Here Map app from Apple Inc.'s (NASDAQ:AAPL) App Store. In the stock's options pits, calls are the contracts of choice, trading at nearly 2.5 times the expected pace. NOK was last seen lingering near $8.06, but those scooping up the January 2014 10-strike calls appear to be betting on a bold move higher in the near term. All of the 6,218 calls traded -- including several large blocks of 1,000 -- have crossed on the ask side, and implied volatility has ticked higher, pointing to buy-to-open activity.

  • Option bears have set their sights on Sprint Corporation (NYSE:S) today, despite the stock soaring to its loftiest level since SoftBank acquired the majority of its shares in July. While there do not appear to be any headlines today that could be prompting the stock's 7.7% jump, Softbank announced yesterday it is in talks with Deutsche Telekom to acquire its stake in T-Mobile US Inc (NYSE:TMUS). A number of eleventh-hour skeptics don't think this momentum will last through tonight's close, and are targeting the weekly 12/27 10.50-strike put. Around 5,200 contracts have traded here, 59% of which have done so on the ask side. Not a single contract currently resides at this out-of-the-money strike, making it safe to assume that new bearish positions are being opened. A winning bet doesn't seem very likely, though, with S last seen trading at $10.74.

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