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.