Too Many Options: $S, $TMUS, $GM, $TWTR, $HLF

by Dan February 6, 2014 4:34 pm • Commentary

Below is a list of some of the most interesting single stock options activity from today’s trading session:

1. S & TMUS:  Lots of headlines over the past week as to whether or not a Softbank/Sprint bid for TMUS would pass U.S. regulators. Some bearish action in both names today, with both stocks down 7% just before noon, there was a closing seller of 20,000 TMUS Feb 34 calls at .40 and then shortly after there was a buyer of 50k Sprint March 7 puts to open for .40

2. MRO:  Oil stocks have gotten slayed in 2014, with MRO down 10% on the year so far, and just today making lows not seen since last May.  A trader sold 20k July 35 calls at .75 to open, likely an overwrite against long stock which would place the callaway level at $35.75 on July expiration up about 10%.

3. AMTD:  look like a trader took some gains in a bullish call spread risk reversal in Jan15, selling 18k of the Jan15 24.50/29.50 call spread at 3.10 to close and buying back 18k of the Jan15 17.50 puts for .35 also to close.   There is 43k open interest in this structure.

4. TWTR – with the stock closing on the dead lows, down 24% at massive technical support at $50, options activity was brisk today with a total of 530k options trading, almost evenly matched between puts and calls.  Not surprisingly, the most active line was the tomorrow expiration 50 puts with 18k trading, followed by 17k of the tomorrow expiration 55 calls.

5. GM:  stock saw a huge reversal higher off the opening lows, despite closing down penny.  A trader rolled down and out some weekly puts selling 16k Feb 7th (tomorrow) 35.50 puts at .46 to close and bought 16k Feb 14th (next week) 34.50 puts for .46 to open.  Options volume ran at about 2x the avg daily volume.

6. JPM – a similar roll but in calls in JPM as a trader sold 3150 Feb 7th 55 calls at 1.09 and bought 4500 Feb 14th 56 calls for .80

7. YHOO – A customer bought 10,000 Apr 40 calls for 1.27. Hard to tell if it was opening or closing, but the open interest in that line was close to 30k so possibly closing

8. HLF – Big call buying to the upside in February as the 80/85 call stupid was bought for a total of 0.90 5400 times. That trade captures earnings but with a pre-announcment already having happened this trade is likely for other reasons. Either as a hedge against a short or something else entirely?