GoPro (GPRO) Bulls Aren't Sweating the Competition

GoPro Inc (GPRO) is trying to fend off a new rival

Digital Content Group

Mar 3, 2015 at 1:23 PM

GPRO
AAPL

Lately, the buzz surrounding GoPro Inc (NASDAQ:GPRO) hasn't been about what it's done, but more about what its competitors are doing. A few weeks ago, Apple Inc.'s (NASDAQ:AAPL) patent news put the camera maker on high alert. In more recent sessions, concerns have arisen that the company could face pressure due to new competition from Xiaomi's Yi Action Camera, which sells for roughly half the price of the GoPro Hero. Regardless, call volume this afternoon is still twice that of put volume in the stock's options pits.

GPRO's most popular option is the weekly 3/6 40-strike call. Buy-to-open activity has been detected here, as traders look to profit on a move above the contract's breakeven price of $41.41 (strike plus volume-weighted average price of $1.41) by the close this Friday, when the weekly series expires.

Traders snatching up GPRO calls is nothing new. During the past two weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), speculators have bought to open 2.23 calls for each put. However, short interest rose 27.6% during the latest reporting period, suggesting some of these long calls may have been at the hands of short sellers hedging.

On the charts, the shares have been hurting more than Derek Rose this year. GoPro Inc (NASDAQ:GPRO) ended 2014 at $63.22, and has since lost 37%. Today, though, the equity is 0.3% higher at $40.

Follow @Schaeffers

Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released!