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Option Clips: General Motors Company, Alcoa Inc, and QUALCOMM, Inc.

Reviewing notable options activity on General Motors Company, Alcoa Inc, and QUALCOMM, Inc.

by 1/21/2014 1:13 PM
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Three equities drawing attention from options traders today are car concern General Motors Company (NYSE:GM), aluminum giant Alcoa Inc (NYSE:AA), and tech issue QUALCOMM, Inc. (NASDAQ:QCOM). Here's a look at how traders have been aligning their speculative bets today.

  • General Motors Company (NYSE:GM) is trading lower today, with the shares off 1% at last check to linger near $38.20. Not surprisingly, put volume has soared to two times the average intraday pace, and the stock's weekly 1/24 39-strike put is the most sought-after position. The majority of the 23,434 contracts traded here did so in one large block of 18,410. According to Trade-Alert, this transaction crossed the tape at an ask price of $0.86, implied volatility (IV) jumped 5.6 percentage points, and volume outstripped open interest. Summing it all up, it appears this position was bought to open.

  • Alcoa Inc (NYSE:AA) tagged a two-year peak this morning, after J.P. Morgan Securities raised its outlook on the equity to "overweight" from "neutral." The positive price action has prompted a rush of activity at the stock's weekly 1/24 12-strike call, where the majority of the 6,225 contracts traded have gone off on the ask side. IV is up, and volume exceeds current levels of open interest, pointing to the initiation of new bullish positions. With AA hovering around $12.15, these calls are in the money (ITM); however, breakeven (at expiration) for today's option buyers is $12.20, which is the strike plus the volume-weighted average price of $0.20.

  • QUALCOMM, Inc. (NASDAQ:QCOM) has been hitting a string of higher highs lately, and today, the equity tapped the $75.52 mark -- its loftiest perch since April 2000. In the stock's options pits, the weekly 1/24 73-strike call has seen the most action thus far, and of the 2,798 contracts that have changed hands, nearly three-fifths have done so at the ask price. With IV up, it appears this call is seeing buy-to-open activity. At last check, these calls were sitting comfortably ITM, with the security perched at $75.12.


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