Pre-Earnings Traders Show Confidence In NQ Mobile Inc (ADR) (NQ)

NQ Mobile Inc (ADR) tends to make sharp moves following earnings

by

Published on Oct 20, 2014 at 2:12 PM
Updated on Apr 20, 2015 at 5:09 PM

NQ Mobile Inc (ADR) (NYSE:NQ) is nearly 8% higher this afternoon to trade at $9.06, and options traders have responded. At last check, calls are changing hands at double the usual intraday pace, and puts are crossing at nine times what's expected .

Digging deeper, however, it appears many of the put traders aren't of the "vanilla" variety. Instead, at NQ's most active strike -- the deep out-of-the-money November 6 put, where roughly 2,500 contracts are on the tape -- speculators are selling to open contracts. This theory is underscored by data from Trade-Alert. In other words, these put writers are gambling on the equity to remain above $6 from now through the close on Friday, Nov. 21, when the newly front-month options expire.

On the charts, NQ has had a rough 2014, surrendering 38.5% of its value. In fact, the stock was below the aforementioned strike as recently as Sept. 23.

Turning to the future, NQ Mobile Inc (ADR) (NYSE:NQ) is scheduled to step up to the earnings mic sometime in mid-November. The shares tend to make big moves following these quarterly events (and in general, too). Over the past eight quarters, the stock has swung an average of 7.6% the day after reporting, including a 20.6% loss in April.


A Schaeffer's exclusive!

The Expert's Guide

Access your FREE trading earning announcements before it's too late!


 
 

Partnercenter


NEW! Explore Schaeffer’s Partners' deals and get connected to top online brokerages with deals tailored exclusively for our readers.  Get answers to your questions regarding transfer fees, commission rates, programs and available discounts related to online trading services.

MORE | MARKETstories


Look Who's Going Bankrupt Next in America
Porter Stansberry is making a concerning prediction.
First Week in April Provides More Coronavirus-Related Volatility
A slew of coronavirus-related news sent markets on another weekly roller coaster ride
Netflix Stock Heading into Historically Bullish Quarter
NFLX's 10-day moving average has stepped up as support lately
The Latest Investor's Guide to Precious Metals
Learn how to protect savings and maximize returns by investing in precious metals.