Too Many Options: Calls Dominate Volume, $LVS, $DELL, $DOW

by Kristen February 22, 2013 4:28 pm • Commentary

The market just needed an up day to bring back the heavily skewed call volumes.

  1. LVS – Over three times average option volume.  There was a buyer of 17,400 May 52.5 calls.  Also a buyer of the Mar16 52.5/55 1×2 call spread 11,700/ 23,400 times.  Stock is up $1.75.  Nevada yesterday rushed through an “emergency” bill making interstate online gambling legal, thus beating NJ to the punch.
  2. DELL – two big lots of the Jan’15 12 calls traded for $2.50: almost 30K and almost 29K.  As Dan said on QuickHits, “Someone thinks a higher bid coming soon!”
  3. DOW – almsost 5 times average option volume.  Buyer of 50,000 Jan’14 40/45 call spreads.  Apparently there has been a buyer of these since late January, with 75,000 already accumulated before today.
  4. ARUN – Aruba Networks – had earnings after the bell yesterday.  Stock is trading up 4 1/2 dollars and almost 40K options have traded versus an average of 3,400.  IV30 has come in 30 points.
  5. AWAY – had earnings on the 20th and stock gapped up.  Today there were buyers of the Apr 30 calls.  9000 have traded against a small open interest.  IV30 which had come in twenty points after earnings is back up almost 10 points.  Average volume in the name is 545 option contracts.
  6. GM – over 103K options traded versus an average of 40K.  Biggest action was a buyer of 16,000 Jun 30 calls. Over 20K have traded on the day.  Also a buyer of 10,000 Jan’15 30’s, and a trade of 4000 Jan’14 25 puts with 8000 Jan’14 30 calls.
  7. BEAM – a maker of premium spirits, looks like an opening seller of about 15,500 Jun 70 calls.  Average option volume is about 1K. That line has significant open interest of 4500 compared to its peers.  Not sure if seller had been there previously.  Buzz in Twitter was about them deciding to water down Makers Mark, then backing down.
  8. NAV – large buyer on the Apr 30 line with over 13K trading versus a very small open interest.  IV30 was up 5 points.  Stock has been down from recent highs in the past two days.
  9. AAPL – Call volume dominated as the stock traded near the 450 pin most of the day.  Largest volume calls for next week were the 450 and 460 Mar1st expiry calls.
  10. GOOG – Also essentially pinned at 800.  Call to put ratio more even though, almost 1 to 1.  Largest non-expiry line to trade was the Mar8th expiry 750 puts, trading over 3k on the day.