Traders Up the Ante On Bank of America Corporation (BAC)

Bank of America Corp (NYSE:BAC) speculators are banking on extended gains

May 19, 2015 at 1:22 PM
facebook twitter linkedin

Bank of America Corp (NYSE:BAC) is up 1.3% this afternoon at $16.72, after the company scored a legal victory last night. This has caught the attention of option bulls, as the financial firm's calls are running at a faster-than-usual intraday clip. By the numbers, 124,000 calls are on the tape, versus 52,000 puts.

The most active BAC strike is the in-the-money June 16 call, where more than 12,700 contracts have been exchanged. A number of these bets may have been bought to open by speculators anticipating extended gains through front-month options expiration, at the close on Friday, June 19. Specifically, based on the volume-weighted average price (VWAP) of $0.76, the buyers think BAC will topple $16.76 (strike plus VWAP) within the option's lifetime.

Today's bullish betting marks a relative change of pace for the security. BAC's 10-day put/call volume ratio across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) is 0.30 -- in the 90th annual percentile. Echoing this, the stock's Schaeffer's put/call open interest ratio (SOIR) stands at a 12-month high of 0.85, indicating short-term speculators have never been as put-skewed during the previous year.

On the charts, Bank of America Corp (NYSE:BAC) has been trying to battle back from an early January sell-off. Since bottoming at $14.97 in mid-January, the stock has muscled 11.7% higher.

Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

Schaeffer's Daily Bulletin Offer


Special Offers from Schaeffer's Trading Partners