Buyout Buzz Sends Option Bulls to 3D Systems Corporation (DDD)

3D Systems Corporation (DDD) option traders are betting on a quick surge

Jan 20, 2015 at 11:14 AM
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Short-term option bulls are blitzing 3D Systems Corporation (NYSE:DDD) today, amid unconfirmed buyout buzz. DDD calls are trading at five times the average intraday clip, and have outpaced puts by a margin of more than 3-to-1.

Attracting the most attention are the weekly 1/23 calls -- specifically, buy-to-open activity has been detected at the 29, 29.50, and 30 strikes. In fact, implied volatility has soared by more than 23 percentage points at each strike, reflecting the growing demand.

By purchasing the calls to open, the buyers expect DDD to be sitting north of the respective strikes by the close on Friday, when the contracts expire. At last check, the equity was 0.2% higher at $28.80.

Today's affinity for short-term calls over puts marks a shift in sentiment for 3D Systems Corporation (NYSE:DDD). The security's Schaeffer's put/call open interest ratio (SOIR) of 1.30 stands higher than 92% of all other readings from the past year, implying that near-term options traders have rarely been more put-skewed. Echoing that, short interest accounts for nearly one-third of the stock's total available float, representing more than two weeks' worth of pent-up buying demand, at DDD's average pace of trading.

 

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