Option Traders See Double Digits for ZIOPHARM Oncology, Inc. (ZIOP)

ZIOPHARM Oncology Inc. (ZIOP) calls are hot as the stock flirts with new highs

by Andrea Kramer

Published on Feb 11, 2015 at 3:30 PM
Updated on Apr 20, 2015 at 5:09 PM

Biotech issue ZIOPHARM Oncology Inc. (NASDAQ:ZIOP) touched a multi-year high of $9.99 in early trading, and was last seen flirting with a 3.7% gain at $9.24. The stock has roughly doubled in value over the past year, and ZIOP options are hot today, as speculators gamble on the stock's short-term trajectory.

The equity's 30-day at-the-money implied volatility has popped 3.7% to 119.4%, reflecting the growing demand for near-term contracts. Intraday call volume is running at twice the average pace, and has outpaced put volume by a margin of more than 3-to-1.

Digging deeper, it looks like one trader is upping the bullish ante. Specifically, it seems the speculator sold to close 3,750 February 10 calls, and bought to open 5,000 March 11 calls. The newly initiated calls will move into the money if ZIOP topples $11 by the close on Friday, March 20, when back-month options expire. Delta on the March 11 call sits at 0.41, implying a roughly 41% shot of an in-the-money finish.

Broadening our sentiment scope reveals that ZIOPHARM Oncology Inc. (NASDAQ:ZIOP) traders are actually more put-heavy than usual right now. The stock's Schaeffer's put/call open interest ratio (SOIR) of 0.23 stands higher than more than three-quarters of all other readings from the past year.


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