Too Many Options: Oct Expiry Gives Way to Nov

by Enis October 19, 2012 5:02 pm • Commentary

October expiry was today, and the market slashed through potential pins throughout the day.

  1. TRIP – Kristen had a good write-up today about the action in the online travel sites.  Someone traded the Nov 30 / 27 1×2 put spread, 9k by 18k in TRIP, potentially rolling their long Nov 30 puts down into 2 Nov 27 puts, based on open interest.
  2. MTW – Rumors from an Italian newspaper indicated that Italy’s Ali Group might be interested in the company.  Stock closed 6% higher (up more than 10% on the week), and options traded 13x avg. volume.  The Mar 17 and Nov 16 calls were most active.
  3. DLTR – This stock got crushed in the past 2 weeks, down almost 20%.  Someone played for a bounce back today, buying 5k of the Nov 42.5 / 43.75 call spread for $0.25
  4. PFE – Some profit taking in the Nov 25 line today, as someone sold 12k to close around $1.00 this morning
  5. SIRI – A trader sold 48k of the Nov 3 straddle at $0.26, ahead of earnings on October 30th.  The stock was actually up 5% this week, and sits at 4 year highs.
  6. CCE – This is a rarely traded name in the options market.  Someone bought 10k of the Nov 30 puts for $0.30 as protection ahead of earnings next week, Oct. 25th.
  7. XRT – In the afternoon, when XRT was down around $62, someone traded the Nov 57 / 66 risk reversal 14,000 times, buying call, selling put, collecting 0.09 on the package.
  8. F – More than 44k of the Nov 11 calls traded around 0.08 today, initiated by the buyer.  Ford reports earnings Oct 30th.
  9. MSFT – For the second straight day, the Oct 29 puts traded more than 30k, as MSFT moved through the strike, and ended up moving close to its implied move of 3%.
  10. AAPL – Big 3.5% move on expiry, finally pinning 610.  The top 6 most traded lines in the market were all Oct in AAPL, but all higher strikes, as the stock only moved down to 610 in the last few minutes of the session, so it was not an anticipated pin.