SolarCity Corporation (SCTY) Option Bulls Bet On a Bigger Tesla Boost

SolarCity Corp's (NASDAQ:SCTY) weekly 5/1 60-strike call is popular today

Apr 22, 2015 at 2:19 PM
facebook twitter linkedin


It's a big day for SolarCity Corp (NASDAQ:SCTY), which earlier toppled the round-number $60 mark for the first time since early November. At last check, though, the shares were up 3.4% at $59.66, after one brokerage firm waxed optimistic on the firm's partnership with Tesla Motors Inc (NASDAQ:TSLA). The upbeat outlook has spread to the options pits, as well, with calls crossing the tape at three times what's typically seen at this point in the day, and outpacing puts by a 3-to-1 margin.

A number of traders are paying particular attention to the round-number $60 mark, and appear to be purchasing new positions at the stock's weekly 5/1 60-strike call. By initiating new long positions here, the goal is for SCTY to extend today's momentum through next Friday's close -- when the weekly series expires -- and settle north of $60. Thanks to today's surge, delta on the call has popped to 0.48 from 0.30, indicating a roughly 1-in-2 chance the option will be in the money at expiration.

Today's accelerated call activity just echoes the withstanding trend seen in SCTY's options pits. For starters, the security's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 6.00 rests just 1 percentage point from a 52-week peak.

Additionally, SCTY's Schaeffer's put/call open interest ratio (SOIR) of 0.46 arrives lower than all other readings taken in the past 12 months. Simply stated, short-term speculators are more call-heavy now toward SolarCity Corp (NASDAQ:SCTY) than they've been at any other point during the past year.

 

 

 

If you are not making money with options, you aren’t buying options like this…

There is no options strategy that more perfectly approaches trading the fastest moving and most volatile stocks available in the marketplace than this one. In fact, there is no strategy that better utilizes put options for optimal returns and a real trading edge over other traders in the exact same market. New options traders fail out at an incredible rate without proper trade research, execution timing, and option picking. Capitalize on Schaeffer’s 100+ years of options trading excellence with the most coveted product launch in company history. Don't waste another second... join us right now before the next round of trades are released!

SCHAEFFER'S JULY STOCKS REPORT AD
 


 


 
Special Offers from Schaeffer's Trading Partners