Breaking Down Intel Options After Last Week's Plummet

Call traders are not deterred, it would seem

Deputy Editor
Oct 26, 2020 at 1:37 PM
facebook twitter linkedin


Below is a list of 20 stocks that have attracted the highest weekly options volume in the last 10 trading days, courtesy of Schaeffer's Senior Quantitative Analyst Rocky White, with highlighted names new to the list. With earnings season picking up steam, many traders are turning to options to speculate on outsized moves and potential volatility. One name new to the list is tech name Intel Corporation (NASDAQ:INTC).

This uptick in options activity is undoubtedly linked to the company's recent third-quarter earnings report, which came out last Thursday. By now, it's no secret that the event was nothing short of disastrous, with Intel posting revenue from its data-center business that sorely missed analysts' expectations. In fact, the stock experienced its worst day in almost three months following the report, and is continuing this downward momentum into today --  off 3.6% to trade at $46.48, and set for its lowest close since its late-March trough. 

INTC Oct 26

Still, calls have been outnumbering puts, with White's data showing 324,331 calls across the tape in the past 10 days, compared to 231,846 puts. Most popular during this time period was the monthly October 55-strike call, which expired on Oct. 16.

Even after INTC's recent selloff, calls are still coming out on top, So far today, 107,000 calls and 72,000 puts have been exchanged, roughly two times the intraday average. The November 50 call is being heavily targeted, as well as the 49 call in the same series. It looks like positions are being bought to open at the latter, implying that these bulls expect the $49 mark to act as a ceiling for the underlying stock before these contracts expire on Nov. 20. 

Most Active Options Oct 26

This recent penchant for bullish bets is unusual. This is per the equity's 50-day call/put volume ratio of 3.97 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands higher than 86% of readings from the past year, implying a healthier-than-usual appetite for long calls of late. 

For those wanting to get in on Intel's recent move, options could be a good way to go. The security's Schaeffer's Volatility Index (SVI) sits in the relatively low 14th percentile of its annual range. This suggests option traders are pricing in low volatility expectations at the moment. 

Winning With Weekly Options

1606854690

  


 
Special Offers from Schaeffer's Trading Partners