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

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

Feb 11, 2015 at 3:30 PM
facebook twitter linkedin


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.

 

 

 

These investors are using the market's volatility to their advantage and scoring triple-digit gains on many of their trades.

Even in today's sideways bear market, this trading strategy has continued to provide consistency and profitability to a small group of investors. By using this approach, these traders are removing directional risk and still hitting triple-digit returns. If you want access to this strategy, and lower risk with higher returns sounds good to you, then don't wait another minute.

Join us now to receive our next trades the moment they come out!

 

Common mistakes options traders make
 


 


 
Special Offers from Schaeffer's Trading Partners