Most Active Options: Chesapeake Energy Corporation and Bristol-Myers Squibb Co

Options traders have set their sights on Chesapeake Energy Corporation (CHK) and Bristol-Myers Squibb Co (BMY)

Josh Selway
Oct 20, 2016 at 12:20 PM
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The 20 stocks listed in the table below have attracted the highest total 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 oil-and-gas stock Chesapeake Energy Corporation (NYSE:CHK) and drugmaker Bristol-Myers Squibb Co (NYSE:BMY)

Most Active Options October 20

Starting with CHK, put buying has been unusually popular in recent weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). During the past 10 days specifically, the stock has accumulated a put/call volume ratio of 1.45, which tops three-fourths of the past year's readings. 

Despite this recent tilt toward puts, CHK options traders have historically preferred calls over puts -- a tendency revealed through the stock's Schaeffer's put/call open interest ratio (SOIR) of 0.84, which is just 9 percentage points from a 12-month low. This means short-term speculators are more call-skewed than usual. In fact, even with the recent push for puts, the two most popular near-term options over the past 10 days, per increases in open interest, are the October 6.50 and 7 calls. And in today's trading, CHK calls are outpacing puts by a nearly 3-to-1 ratio. 

Looking to the charts, Chesapeake Energy Corporation (NYSE:CHK) is down 1% today at $6.65. However, year-to-date, the stock is up 48%, and continues to rise along with its 50-day moving average. 

Now, turning our attention to BMY, the stock has seen heavy attention from options traders as it tries to recover from its drug-related losses. Currently, total option open interest is just 1 percentage point from an annual high. As for the last two weeks in particular, options traders have taken a strong bullish stance, with call buying more than tripling put buying across the ISE, CBOE, and PHLX. 

Digging deeper, calls account for seven of the top 10 increases in open interest during the past two weeks for BMY. For front-month options, the October 50 call has seen the biggest influx, though the top spot overall belongs to the November 52.50 call. Data from the major options exchanges confirms notable buy-to-open activity at each strike, meaning traders are betting on extended upside for BMY in the weeks ahead. 

Of course, the stock has a ways to go to make up for its performance so far in 2016, with the shares down nearly 27%. Today, however, Bristol-Myers Squibb Co (NYSE:BMY) is up 1.1% at $50.41, as the shares continue to hug the half-century mark. 

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