GoPro, Inc. (GPRO) Puts Popular as Shares Tumble

GoPro Inc (GPRO) hasn't had the best few months on the charts

by Digital Content Group

Published on Apr 1, 2015 at 2:18 PM
Updated on Jun 24, 2020 at 10:16 AM

During the past three months, GoPro Inc (NASDAQ:GPRO) has underperformed the S&P 500 Index (SPX) by roughly 36 percentage points. That downtrend is continuing today, with the shares 5.8% lower to trade at $40.91. In GPRO's options pits, put volume is accelerated, with heavy focus on the weekly in-the-money 4/2 41.50-strike put. It appears traders are buying to open the contracts, as they look to profit on a bigger dip in the shares by the time the options expire at tomorrow's close.

Strangely, even as GPRO has continued to slide on the charts, short-term speculators have become more call-skewed. This becomes apparent when looking at the equity's Schaeffer's put/call open interest ratio (SOIR), which currently sits at 0.78 -- near all-time lows. Looking at the chart below, it's clear traders have grown much more call-skewed than normal, at least toward options expiring in three months or less.

Daily Closing Price of GPRO since October 2014 with SOIR

On the other hand, short interest on GPRO is high, with bearish traders shorting 34.3% of the equity's float. There is a chance that the recent rush for calls is due to short sellers looking to hedge their bets against any upside move in GoPro Inc (NASDAQ:GPRO).


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