American Airlines Group Inc (AAL) Option Bears Aim Lower

American Airlines Group Inc is moving little, despite reporting earnings

Digital Content Group

Oct 23, 2014 at 10:31 AM

American Airlines Group Inc (NASDAQ:AAL) is up slightly this morning at $37.13, after earlier posting a third-quarter earnings beat. This is likely a disappointment to many traders from yesterday, when puts crossed at nearly double the usual single-session rate.

Digging deeper, short-term contracts were once again popular on Wednesday, per AAL's 30-day at-the-money (ATM) implied volatility, which rose 2.7% to 49.7%. Specifically, the equity's most active option was the weekly 10/24 37-strike put, where roughly 8,900 contracts changed hands. The majority did so at the ask price, and open interest soared overnight, collectively suggesting buy-to-open activity.

By scooping up the ATM puts, these speculators expect America Airlines Group Inc (NASDAQ:AAL) will end the week -- when the contracts expire -- south of $37. Delta on the put is negative 0.46, indicating a 46% chance the option will be in the money at tomorrow's close.

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