Nasdaq Can't Be Stopped; Dow Jones Industrial Average Heads North

Is This "Auto-Hedge" Worth the Risk?

by Karee Venema

Published on Jul 20, 2015 at 11:50 AM
Updated on Jul 20, 2015 at 11:59 AM

It's another day, another new peak for the Nasdaq Composite (COMP), which earlier topped out at an intraday best of 5,225.30. Buoying the tech-heavy benchmark are analyst-induced pops for two notable COMP components, with both notching their highest perches to date. Elsewhere, the Dow Jones Industrial Average (DJIA) and the S&P 500 Index (SPX) have each moved off earlier lows, and are enjoying modest gains at midday. Looking ahead, this week's market drivers will be brought back home, as Greece takes a backseat to corporate earnings season and tumbling commodities.


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Among the stocks with notable call volume is wearable camera maker GoPro Inc (NASDAQ:GPRO), with the contracts changing hands at eight times the average intraday rate -- and outpacing puts by a 2-to-1 margin. The stock is up 5.3% at $59.61, and it seems like pre-earnings option traders are buying to open the weekly 7/24 60-strike call, betting on a round-number breakout by week's end.


Vivint Solar Inc (NYSE:VSLR) is the top gainer on the Big Board -- up 44.4% at $15.73. Helping boost the shares is news of a multi-billion-dollar buyout bid from one of its sector peers. The security is now boasting a year-to-date lead of 70%.


Unlike fellow toy stock Mattel, Inc. (NASDAQ:MAT), Hasbro, Inc. (NASDAQ:HAS) is soaring after the company's quarterly earnings report. Specifically, the firm's second-quarter earnings beat estimates, sending the shares to a record high of $83.52 in early action. More recently, the stock was up 6.1% at $83.01 -- just as the options market predicted -- and on track for its first-ever close north of the round-number $80 mark. This area that has contained HAS in recent weeks.



The CBOE Volatility Index (VIX) is down 0.1 point, or 0.7%, at 11.87, and on track for its first sub-12 close since early December.


Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 1.86, with puts almost doubling calls. SPY is up 0.3 point, or 0.1%, at $212.73.

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