ACADIA Pharmaceuticals Inc. (ACAD) Option Traders Are Fired Up

ACADIA Pharmaceuticals Inc. (ACAD) shares are hot, and option buyers are betting bullishly

by Andrea Kramer

Published on Feb 19, 2015 at 2:54 PM
Updated on Apr 20, 2015 at 5:09 PM

ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) shares are up 3.1% at $36.82 -- and earlier notched an all-time high of $37.21 -- as some speculate that a key new drug application (NDA) could be on the horizon. Against this backdrop, ACAD calls are trading at three times the average intraday clip, with bulls betting on more upside over the next month.

Most active is ACAD's March 35 call. Those buying the contracts to open hope ACAD extends its journey north of $35 through the next few weeks, and will profit if ACAD perforates $38.20 (strike plus volume-weighted average price of $3.20) -- in uncharted territory -- by expiration on Friday, March 20. Delta on the soon-to-be front-month call stands at 0.66, implying a roughly 2-in-3 shot of the contracts expiring in the money.

Today's preference for short-term calls runs counter to the norm. The stock's Schaeffer's put/call open interest ratio (SOIR) of 0.62 sits higher than 85% of all other readings from the past year, suggesting ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) short-term traders are more put-biased than usual.


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