Calls Hot as Apple Inc. (AAPL) Unveils iPhone SE

Apple Inc.'s (NASDAQ:AAPL) weekly 3/24 107-strike call is being bought to open today

by Karee Venema

Published on Mar 21, 2016 at 2:32 PM

All eyes are on Apple Inc. (NASDAQ:AAPL) this afternoon, in the wake of the tech titan's March media event. Earlier, Apple unveiled a handful of new health apps, as well the latest iPhone and iPad iterations -- the iPhone SE and the smaller iPad Pro. Additionally -- ahead of tomorrow's showdown with the FBI -- CEO Tim Cook said it was the company's duty to protect user data and privacy, and that Apple "will not shrink from that responsibility." The stock, meanwhile, has moved 0.5% lower this afternoon to $105.35, but options traders are holding out hope for an end-of-week rally.

Specifically, calls are crossing at 1.2 times the expected intraday rate -- and outpacing puts by a healthy margin. The security's weekly 3/24 107-strike call has seen the most action, with nearly 24,000 contracts on the tape at last check. It looks as if new positions are being purchased, as speculators bet on AAPL being above $107 at this Thursday's close -- when the weekly series expires.

Widening the sentiment scope reveals put buying has been a popular strategy in AAPL's options pits in recent months. Regardless of whether speculators are buying to open calls or puts, though, the stock's near-term options are pricing in relatively low volatility expectations at the moment. In fact, AAPL's 30-day at-the-money implied volatility of 21.6% sits lower than 78% of all comparable readings taken in the past year.

Elsewhere on the Street, short sellers have been jumping ship en masse. In the last two reporting periods, short interest fell 25% to 47.4 million shares -- the lowest amount since January 2011. Meanwhile, 24 analysts maintain a "buy" or better rating toward Apple Inc. (NASDAQ:AAPL), versus six "holds" and one "strong sell."

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