Most Active Weekly Options: Apple Inc. and Alibaba Group Holding Limited

Short-term options traders are targeting Apple Inc. (NASDAQ:AAPL) and Alibaba Group Holding Ltd (NYSE:BABA)

by Alex Eppstein

Published on Jun 30, 2015 at 11:22 AM

The 20 stocks listed in the table below have attracted the highest total weekly options volume during the past 10 trading days. Names highlighted are new to the list since the last time the study was run, and data is courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. Two names of notable interest are iPad parent Apple Inc. (NASDAQ:AAPL) and e-tailer Alibaba Group Holding Ltd (NYSE:BABA).

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AAPL is up 0.9% at $125.67 today, amid the launch of Apple Music. In other news, a federal court of appeals upheld a lower court decision that the company violated federal antitrust laws by conspiring to fix e-book prices. Longer term on the charts, the stock has been stair-stepping its way lower since its late-May high of $132.97.

Amid these losses, options traders have been buying to open AAPL puts over calls at an accelerated clip, per data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). Specifically, the equity's 10-day put/call volume ratio of 0.61 registers in the bearishly skewed 98th annual percentile. Today, however, AAPL is seeing buy-to-open activity at its weekly 7/2 126-strike call -- the equity's most active option -- as speculators wager on upside through this Thursday's close, when the series expires.

Elsewhere on the Street, brokerage firms are bullish toward AAPL. Of the 34 analysts tracking the shares, 22 have doled out "buy" or better assessments; plus, the stock's consensus 12-month price target of $148.75 stands in uncharted territory. Should AAPL continue to churn lower, a round of bearish analyst notes could result in headwinds.

​Shifting gears, BABA is attempting to come back from yesterday's sell-off in Chinese stocks, up 1.7% at $82.46. Helping the shares are reports the company may be trying to acquire India-based online payment platform Paytm. Longer term, however, the security remains a dud, down nearly 21% year-to-date.

In today's options pits, the weekly 7/2 and 7/10 series are popular, accounting for six of the 10 most active strikes -- with potential buy-to-open activity at the weekly 7/2 81.50-strike call, and sell-to-open activity transpiring at the weekly 7/10 85-strike call, according to the ISE. Option bulls have been active in recent weeks, based on BABA's 10-day ISE/CBOE/PHLX call/put volume ratio of 3.86 -- indicating long calls have outpaced puts by a nearly 4-to-1 margin.

As with Apple Inc. (NASDAQ:AAPL), optimism runs high toward Alibaba Group Holding Ltd (NYSE:BABA) within the brokerage bunch. All but one analyst covering the latter stock rates it a "buy" or better, and its consensus 12-month price target of $107.26 sits in waters not charted since late December. This could leave BABA vulnerable to a round of bearish attention.


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