Schaeffer's 43rd Anniversary Stock Picks in 2024

Put Players Target Tesla Motors Inc (TSLA) as BMW Talks Fizzle

Tesla Motors Inc short-term put players continue to be active

Dec 1, 2014 at 1:20 PM
facebook X logo linkedin


Short-term put players have set their sights on Tesla Motors Inc (NASDAQ:TSLA), as evidenced by the equity's Schaeffer's put/call open interest ratio (SOIR) of 1.60, which ranks in the 98th percentile of its annual range. Simply stated, near-term traders have been more put-heavy on TSLA just 2% of the time within the past year.

It's a similar set-up in today's session, with puts trading at 1.5 times the typical intraday pace. Plus, the equity's 30-day at-the-money implied volatility (IV) has surged 14.5% to 36.5%, signaling elevated demand for TSLA's short-term contracts.

The stock's two most active options are the weekly 12/5 230- and 235-strike puts, where a collective 8,320 contracts have changed hands. A healthy portion of these have done so on the ask side, IV is higher, and volume outstrips open interest -- all signs of buy-to-open activity.

By initiating the long puts, the speculators are betting on the equity to finish the week -- when the series expires -- below the respective strike prices. Delta on the higher-strike put is negative 0.56, implying a 56% chance of an in-the-money finish at Friday's close. Meanwhile, delta on the lower-strike put is docked at negative 0.39.

On the charts, TSLA has had a standout year, with the shares up almost 55%. Today, however, the equity has given back nearly 5% to linger near $232.74, after BMW put the kibosh on last week's rumors that it was interested in collaborating with Tesla Motors Inc (NASDAQ:TSLA).

 

A.I.’s Dirty Little Secret: The Real Power Behind The AI. Boom ✨

Anyone who’s seen the The Matrix movies knows that A.I. needs power.  Lots and lots of power.

If you’ve seen the movie, you also know the grizzly results of the ensuing battle for that power.

Now, Wall Street’s battle for A.I. power won’t go to such extremes. Hopefully?

A.I. needs more power and that means more opportunities for stock traders in the know.

Download your free copy of “The A.I. Revolution: 4 Stocks to Buy Now”!