Most Active Options Update: Apple Inc. (AAPL)

Apple Inc. option bulls bet on a bigger bounce through week's end

by Karee Venema

Published on Dec 2, 2014 at 12:11 PM
Updated on Apr 20, 2015 at 5:09 PM

The 20 stocks listed in the table below have attracted the highest total options volume during the past 10 trading days. Names highlighted are new to the list since the last time the study was run, and data is courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. One name of notable interest today is tech titan Apple Inc. (NASDAQ:AAPL), which is attempting to bounce back from Monday's "flash crash."

Most Active Options Table

It's already been quite a week for Apple Inc. On Monday, the stock was down more than 6% at its session low, before paring its loss to 3.2%. Although it's not clear as to why the equity sold off so suddenly, CNBC offered up some suggestions, including sector-wide weakness in retail names. Today, the stock has been seen on both sides of breakeven, as traders digest a price-target hike to $135 from $120 and reiterated "buy" rating at Canaccord Genuity, and news that AAPL is headed to court over allegations the company's iPods monopolized the digital music player market.

However, the equity seems to have found a foothold near the $115 mark -- and was last seen up 0.2% at $115.28 -- prompting today's option players to target this area as a short-term level of support. Specifically, the weekly 12/5 115-strike call has received notable attention in AAPL's options pits today. A healthy portion of the 27,173 contracts traded here have done so at the ask price, hinting at buyer-driven volume. What's more, implied volatility edged higher on several notable blocks, and volume outstrips open interest, making it safe to assume a portion of the day's activity is of the buy-to-open kind.

Based on the volume-weighted average price (VWAP) of $1.11, breakeven for today's call buyers at this Friday's close -- when the weekly series expires -- is $116.11 (strike plus VWAP). Profit will accumulate north of here, while losses are capped at the initial premium paid, should Apple Inc. (NASDAQ:AAPL) settle the week south of the strike. According to the options market, it's roughly a toss of the coin as to whether or not this call will be in the money at week's end, as its delta is docked at 0.55.

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