Ackman Has Mondelez International Inc (MDLZ) Option Traders On Edge

Bill Ackman's Pershing Square Capital Management has reduced its stake in Mondelez International Inc (NASDAQ:MDLZ)

Mar 17, 2016 at 10:30 AM
facebook X logo linkedin


Valeant Pharmaceuticals Intl Inc (NYSE:VRX) dealt Bill Ackman's Pershing Square Capital Management a devastating blow this week, prompting Ackman to cut his stake in Mondelez International Inc (NASDAQ:MDLZ). As a result, the shares of MDLZ are down 1.4% this morning to $41.13 -- and option players are keeping a close eye on today's trading.

Yesterday, specifically, the stock's June 38 put was MDLZ's most active option, with 2,644 contracts traded. However, it looks like the majority of the activity was of the sell-to-open kind, as speculators bet on the $38 mark to hold as support through the close on Friday, June 17 -- when the options expire.

This penchant for short puts only echoes a withstanding trend. In fact, over the past 10 sessions, speculators at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have sold to open 2.95 puts for each one they've purchased.

Drilling down, MDLZ's April 40 put has seen the biggest rise in open interest over this time frame, with more than 8,000 contracts added. According to the ISE, CBOE, and PHLX, the majority of the action is a result of speculators writing the puts to open, eyeing a foothold atop the round-number $40 mark through April options expiration.

Heading into today's trading, the stock had put in a stellar rebound off its Feb. 8 year-to-date low of $35.88, up 14.6%. Amid this rally, Mondelez International Inc (NASDAQ:MDLZ) climbed back above its 50-day moving average -- a trendline that appears to be containing this morning's negative price action.

160317mdlz

Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical  levels, and top economic stories straight to your inbox.

 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI