Tesla Options Traders Show Skepticism About 'Autopilot 2.0'

Multiple reports suggest Tesla Motors Inc (TSLA) CEO Elon Musk could soon reveal details on "Autopilot 2.0"

Sep 7, 2016 at 11:18 AM
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As Tesla Motors Inc (NASDAQ:TSLA) continues to test the round $200 area, Wall Street is gearing up for Elon Musk to divulge details on the next generation of the company's self-driving technology, otherwise known as "Autopilot 2.0." The first iteration of the feature has been marred by controversy, but improvements are expected, according to multiple reports -- including better radar-signal processing. In advance of potential news, TSLA put options have been growing in popularity.

According to data at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the electric automaker's 10-day put/call volume ratio has risen to 1.12 from 0.97 over the past two weeks. What's more, the current ratio ranks in the bearishly skewed 88th percentile of its annual range. Put simply, options traders have been scooping up puts over calls at an accelerated clip, historically speaking.

Underscoring this put-skew is TSLA's front-month gamma-weighted Schaeffer's put/call open interest ratio (SOIR) of 1.86. This reading suggests near-the-money put options in the September series nearly double calls. Understandably, one of the heaviest strikes in the front-month series is the September 200 put, with over 12,000 contracts in residence -- with data from the major exchanges indicating a mix of buy- and sell-to-open activity.

Options traders aren't the only ones skeptical of Tesla stock. For instance, 22.6% of its float is sold short, representing 9.1 days' worth of trading, at TSLA's typical levels. Plus, three-quarters of the analysts tracking the shares consider them a "hold" or worse.

Technically speaking, Tesla Motors Inc (NASDAQ:TSLA) has been a mixed bag. On the one hand, the stock rallied hard off of its early February lows -- nearly doubling in less than two months. On the other, TSLA shares have struggled since topping out near $270, pressured recently by some embarrassing headlines. At last check, the stock is down 0.6% at $201.60.

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