Crypto Stock's Options Activity Ramps Up as Bitcoin Soars

Riot Blockchain is seeing call interest ramp up

Deputy Editor
Oct 25, 2021 at 1:16 PM
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The recent spike in Bitcoin (BTC) has led to renewed interest in crypto-adjacent stocks like Riot Blockchain Inc (NASDAQ:RIOT). RIOT was last seen up 6.4% to trade at $30.10, and pacing for its best monthly performance since June.  A recent pullback was saved by the $24 level, as well as long-term support at the 320-day moving average. Though a far cry away from its Feb. 17 decade-high of $79.50, Riot Blockchain stock boasts an incredible 675% year-over-year rise. 

RIOT Chart October 25

What's more, Riot Blockchain stock has found itself on Schaeffer's Senior Quantitative Analyst Rocky White's list of stocks that have attracted the highest weekly options volume within the past two weeks. According to White's data, 464,932 calls and 154,765 puts were exchanged over this two-week period.

MAO Chart Oct 25

At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), RIOT sports a 10-day call/put volume ratio of 4.73. That ratio is stands in the 85th percentile of readings from the past 12 months, and indicates that calls are being picked up a faster-than-usual clip.

The good news for prospective options traders is that premium is reasonably priced right now. Riot Blockchain stock's Schaeffer's Volatility Index (SVI) of 97% sits higher than just 7% of readings from the past 12 months, suggesting options players are pricing in low volatility expectations for the stock at the moment. Plus, the security's Schaeffer's Volatility Scorecard (SVS) comes in at 99 (out of 100). In other words, RIOT has exceeded options traders' volatility expectations in the last year.

Though there's a relatively limited sample size, analysts seem quite bullish on RIOT. In fact, all five brokerages covering the equity rate it a "strong buy." Plus, the brokerages' 12-month average price target of $52.29 is a staggering 74.3% premium to current levels.


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