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BlackBerry Ltd announced a new iPhone trade-in program this morning
Short-term contracts were targeted in BlackBerry Ltd's (NASDAQ:BBRY) options pits yesterday. In fact, eight of the 10 most active strikes will expire within the next six weeks.
Looking more closely, traders showed a particular affinity for BBRY's weekly 11/28 10-strike and 12/5 9.50-strike puts, where a collective 3,538 contracts changed hands. The vast majority did so at the bid price, and open interest soared overnight at both strikes, making it safe to assume at least some of the out-of-the-money contracts were sold to open. This theory is corroborated by data from the International Securities Exchange (ISE).
In short, these put writers expect BBRY to maintain its footing atop the strikes through the respective expiration dates, at the end of this week and next week. To put things in perspective, delta on the higher-strike contract is negative 0.094, while delta on the lower is negative 0.086 -- signifying a less than 1-in-10 chance either option will be in the money at expiration.
This morning, BlackBerry Ltd (NASDAQ:BBRY) is 0.6% higher at $10.42, following the company's announcement that it will offer customers up to $550 to trade in their Apple Inc. (NASDAQ:AAPL) iPhones in exchange for the new BBRY Passport smartphone. Longer term, the shares have advanced more than 40% year-to-date.