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Option Clips: Rambus, Kandi Technologies Group, and Guess

Reviewing notable options activity on Rambus Inc., Kandi Technologies Group Inc, and Guess?, Inc.

by 3/18/2014 1:16 PM
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Two equities generating buzz on StockTwits today are tech concern Rambus Inc. (NASDAQ:RMBS) and China-based electric vehicle maker Kandi Technologies Group Inc (NASDAQ:KNDI). Meanwhile, casual apparel brand Guess?, Inc. (NYSE:GES) has also been active in the options pits ahead of earnings. Here's a look at how traders have been aligning their speculative bets today.

  • Rambus Inc. (NASDAQ:RMBS) is 7.1% higher at $10.61, adding to its year-to-date gain of more than 12%. In fact, the stock is just a chip-shot away from its annual high of $10.85, tagged in late July, and is hovering north of its upper Bollinger Band. What's more, options traders are expecting RMBS to extend its journey in double-digit territory, with calls flying off the shelves at six times the normal intraday rate. Plus, the stock's 30-day at-the-money (ATM) implied volatility (IV) is 9.6% higher at 40.5%, reflecting the escalating demand for short-term contracts. Digging deeper, traders are apparently buying to open the March 10 call, on hopes for more upside through Friday's close, when front-month options expire.

  • Kandi Technologies Group Inc (NASDAQ:KNDI) surged more than 23% on Monday, after the company said fourth-quarter revenue almost doubled, thanks to China's new electric vehicle subsidy policy. Today, however, traders are taking profits, with KNDI down 2.5% at $20.87 -- but not before touching a fresh record high of $22.40 in early trading. KNDI calls are trading at a faster-than-usual clip, with more than 8,100 contracts exchanged, representing a 71% mark-up to the stock's average intraday pace. Upon closer inspection, option bulls are rolling the dice on even higher highs for the shares, buying to open the out-of-the-money September 25 calls.

  • Finally, Guess?, Inc. (NYSE:GES) options are in demand ahead of the company's turn in the earnings confessional tomorrow night. The equity's 30-day ATM IV is 11.8% higher at 51.2%, with calls the options of choice. So far, roughly 8,800 GES calls have traded -- 34 times the stock's typical intraday volume, and more than six times the number of GES puts exchanged. Speculators have taken a shine to the security's March 30 call, where more than 6,100 contracts have traded, primarily at the ask price. Plus, volume handily exceeds open interest at the strike, hinting at newly bought pre-earnings bets. More conservative bulls, meanwhile, are going long the March 29 calls. At last check, GES is 1.7% higher at $28.92.


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