Too Many Options: $AAPL, $EEM, $GM, $VIX, $YHOO, $GDX

by Dan February 3, 2014 4:33 pm • Commentary

On a day that saw heavy selling across all the major indices including the Nasdaq’s worst day since 2011, these were some large options trades that caught our attention:

1.  VIX – Huge roll in calls, trader sold 160k Feb 24/29 call spreads at .38 to close, and bought 40k Mar 20/35 call spreads for 1.39 to open & bought 60k Mar 25/35 call spreads for .625 to open.  In another roll a trader sold 10k Mar 17/27 call spreads to close and bought 20k May 17/30 call spreads to open.

2. EEM – on a day that saw the etf make a new 5 month low, puts outnumbered calls at a pace of 4.5 to 1.  There seemed to be no shortage of  put sellers though as some traders were possibly closing hedges or just closing outright bearish bets. This morning there was a seller of 35k Feb 39 puts at 1.61 to close, and just now there was a seller of 30k Feb 36/38 put spreads at .73 to close.  On the close there was a seller of 20k March 35/37 put spreads at .60 to close.

3. GM – The stock got slammed today (but in line with the SPX) on the back of worse than expected January auto-sales and obviously an overall crappy market.  Interestingly calls out numbered puts at almost 1.5 to 1, but much of the activity was bearish.  In the morning there was a seller of 24,000 March 42 calls at 13 cents to close when the stock was $35.42.  While these are very cheap options from a premium standpoint, this sale is pretty much a trader throwing the white flag up on their trade, getting whatever they can for the options. In a much more bearish trade, there was a buyer of 20,000 Feb 7th (this Friday expiration) 35.50 strike puts paying 1.07 to open.  This could be protection against a long position or obviously just a short term bearish bet.  There was a seller of 12k June 40 calls at .89 to close.  There was one bullish trade that stuck out in the afternoon where a trader bought 8k March 38 calls for .62 to open.

4. AAPL –  Bullish options trade which was fairly decent size for a $500 stock, trader paid   2.05 for 2500 by 5k  of the April 530 / 560 1×2 Call Spreads.  This traded targets $560 as the optimal spot for profit potential, but ultimately profits btwn 532.05 & 587.95, with the max gain of 27.95 at $560

5. YHOO – A ratio spread in March puts traded as a customer sold 1900 36 puts at 2.05 and bought 3000 32 puts for .57. This is possibly a roll with some profit taking as the puts sold are more deltas and premium than the ratio of the puts bought.

6. GDX – A trader bought the June 24/27 1×2 call spread 1500 by 3000 at even vs. 23.73 in the stock.