Most Active Weekly Options: Citigroup, JPMorgan Chase

Pre-earnings options traders have set their sights on bank stocks Citigroup Inc (NYSE:C) and JPMorgan Chase & Co. (NYSE:JPM)

Oct 13, 2016 at 10:51 AM
facebook twitter linkedin

The 20 stocks listed in the table below have attracted the highest weekly options volume during the past 10 trading days. Stocks 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 notable names are bank stocks Citigroup Inc (NYSE:C) and JPMorgan Chase & Co. (NYSE:JPM), with both financial firms slated to report third-quarter earnings tomorrow morning.

most active weekly options october 13

Call players are active in C's options pits today, with volume trading at two times what's typically seen at this point in the session. At last check, roughly 18,400 C call options were on the tape. Most active is the stock's weekly 10/14 46.50-strike call -- which expires at tomorrow's close -- where new positions are being initiated. However, it's unclear at this time whether the positions are being bought or sold.

More broadly speaking, C put buyers have been relatively busy in recent weeks. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 10-day put/call volume ratio of 0.72 ranks in the 79th annual percentile. In other words, puts have been bought to open over calls at a faster-than-usual clip.

Even more telling is Citigroup's top-heavy Schaeffer's put/call open interest ratio (SOIR) of 1.19. Not only does this indicate puts outweigh calls among options set to expire in three months or less, but it ranks just 2 percentage points from a 52-week peak. Simply stated, short-term speculators are more put-heavy than usual toward the bank stock.

Call volume has picked up the pace in JPM's options pits. In mid-morning action, roughly 20,600 JPM calls are on the tape -- more than two times the expected intraday volume of 8,438 contracts, and double the 9,585 puts that have traded. While the stock's December 70 call has garnered the most attention, eleventh-hour speculators could be hoping for an earnings-induced bounce, with apparent buy-to-open activity detected at the weekly 10/14 68.50-strike call.

This would only echo the withstanding trend seen in JPMorgan's options arena. Specifically, speculators at the ISE, CBOE, and PHLX have bought to open 48,791 call options on JPM in the past two weeks, compared to 22,629 put options. What's more, the resultant call/put volume ratio of 2.16 ranks higher than 96% of all comparable readings taken in the past year.

On the charts, both bank stocks are tumbling today, after the September Fed minutes failed to provide a specific timeline for lifting interest rates. At last check, JPMorgan Chase & Co. -- which hit an annual high of $69.06 on Monday -- was down 1.7% at $67.00, but finding a foothold atop its 30-day moving average. Citigroup Inc, meanwhile, is continuing its retreat from the round $50 level -- which swiftly rejected the stock on Monday -- down 2.2% at $47.65.

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.

Now is the time to join our thriving community of Event Traders who consistently profit from every earnings season. With this discounted subscription opportunity, you'll stay ahead of the curve and seize opportunities others miss. Do not let Q3 earnings season pass you by – subscribe now and supercharge your portfolio with expert insights that turn market reactions into profit-generating opportunities!! Don't waste another second... join us right now before the next trade targeting +200% is released!