Kandi Technologies Group Inc (KNDI) Guidance Has Call Players Buzzing

Kandi Technologies Group Inc (NASDAQ:KNDI) is higher today on a strong second-quarter sales forecast

Jul 14, 2016 at 3:24 PM
facebook twitter linkedin

As Tesla Motors Inc (NASDAQ:TSLA) struggles, shares of Kandi Technologies Group Inc (NASDAQ:KNDI) have surged 4.4%, after the China-based company upped the second-quarter sales forecast for its electric vehicle unit. Today's upside comes as a welcome surprise for the underperforming stock -- and has sparked a mad rush toward calls in KNDI stock's typically quiet options pits. At last check, 923 call options were on the tape -- two times what's typically seen at this point in the day.

Despite the relatively low absolute volume in KNDI's options arena, speculators have shown a preference for near-the-money calls over puts among options expiring in three months or less. Specifically, KNDI's gamma-weighted Schaeffer's put/call open interest ratio (SOIR) is currently docked at 0.69. Drilling down on the front-month series -- which expires at this Friday's close -- peak call open interest is found at the July 10 strike, although it's not easy to tell whether these positions were initially bought or sold to open.

Outside of the options arena, short interest accounts for 15.9% of KNDI's available float, or 20.6 times the stock's average daily pace of trading. However, it appears short sellers have been tapping the brakes on their bearish bets, with short interest down 20% on a year-over-year basis.

On the charts, Kandi Technologies Group Inc (NASDAQ:KNDI) has shed 39% since topping out at an annual high of $12 in late December. More recently, the shares have struggled to breakout above the $7.20-$7.50 range. After hitting an intraday high of $7.69 earlier, KNDI was last seen at $7.35.

Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical  levels, and top economic stories straight to your inbox.


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 Investment Research Master Portfolio Trial


Special Offers from Schaeffer's Trading Partners