Options Bulls Continue to Target Struggling Ford Motor Stock

Puts, however, have been gaining popularity

Deputy Editor
Oct 3, 2022 at 1:14 PM
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Though it's trading higher today, last seen 4.2% higher at $15.02, Ford Motor Company (NYSE:F) continues to struggle on the year, sitting well below its Jan. 13, 20-year high of $25.87. The shares' rally attempt in mid-August was stopped short near the $16.50 level, after running into overhead pressure at their 200-day moving average. While F is holding above its July 5, annual low of $10.61, it sits 44.5% lower year-to-date.

F Chart October 032022

This recent underperformance has done nothing to turn away the bulls. In fact, the security just appeared on Schaeffer's Senior Quantitative Analyst Rocky White's list of names that have attracted the highest weekly options volume in the past two weeks. Per this data, 2,021,779 calls and 1,541,774 puts were traded within this two-week time period. The weekly 9/30 13.50-strike call was the most popular contract, followed by the 9/30 12-strike put.

MAO Chart October 032022

While calls did outnumber puts during these last two weeks, a broader look shows short-term options traders have favored puts. This is per F's Schaeffer's put/call open interest ratio (SOIR) of 1.64, which stands in the 96th percentile of annual readings. Puts have been gaining popularity at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), too, as Ford motor stock sports a 50-day put/call volume ratio that's higher than 72% of other readings from the past year. 

Options look like a an ideal way to speculate on the equity's next move. This is per the F's Schaeffer's Volatility Scorecard (SVS) of 98 out of 100, which indicates the stock has consistently realized bigger returns than options traders have priced in over the last 12 months.

 

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