Most Active Weekly Options: General Motors Company (GM)

Strong third-quarter sales data isn't helping General Motors Company on the charts


Published on Oct 15, 2014 at 1:22 PM
Updated on Apr 20, 2015 at 5:09 PM

The 20 stocks listed in the table below are the S&P 500 Index (SPX) components that have attracted the highest weekly options volume during the past 10 trading days. Names highlighted are new to the list since the last time the study was run, and data is courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. One name of notable interest today is General Motors Company (NYSE:GM), where options traders are focused on a rebound.

Most Active Weekly Options Table

Despite revealing 2% global sales growth last quarter -- selling roughly 2.45 million vehicles, the automaker's best third quarter since 1980 -- General Motors Company is getting pummeled on the charts. Earlier, the stock hit a new annual low of $28.87, and was sitting 3.5% lower at $29.06, at last check.

In the options pits, overall volume has spiked to 53% above the intraday norm. Most active is GM's January 2015 31-strike call, largely related to a 10,000-contract lot that appears to have been bought to open, and is tied to stock. With respect to short-term options, the weekly 10/24 30-strike call is seeing the most action, with 3,760 contracts on the tape.

About 70% of these weekly calls have been exchanged at the ask price, implied volatility has surged 14.8 percentage points, and volume outstrips open interest. In sum, it appears traders are buying to open the contracts in the hopes that GM will mount a short-term rally by next Friday's close, when the weekly series expires.

Looking ahead, General Motors Company (NYSE:GM) will report third-quarter earnings next Wednesday, Oct. 22. This doesn't necessarily bode well for today's option bulls. Last time GM stepped into the confessional, the stock suffered a 4.5% loss in the ensuing session.

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