Too Many Options: $SPY, $VIX, $IWM, $CMCSA, $FB, $DOW, $GILD

by Enis March 3, 2014 7:21 am • Commentary

Macro ETFs dominated the options volumes on Friday, as stock volumes were the highest in several weeks on month end flows and rebalancing.

1.  SPY – Hit a new all-time high before closing close to flat on Russian aggression in the Ukraine.  Aside from weekly options, the April 190 calls were the most traded line on the day, racing over 100k at an average price of 1.25.  Call to put ratio was around 0.7, which is a bit higher than the 1 month average of 0.6.

2.  VIX – Total options volume was about 1.75 times the 1 month average.  The Apr 30 calls were the most active line, trading over 80k at an average price of 0.225.  There was a buyer of 20k of the Apr 20/30 call spread for 0.49 in the morning.

3.  IWM – Also hit a new all-time high intraday before giving back the gains to close lower.  Put options were unusually active on month end, with the Mar22nd 115 puts trading over 75k on the day.  Outside of Feb and March, the most active was the Apr 112 puts.

4.  CMCSA – Buyer of 70k of the Jan15 55/60 call spread for 1.30 to open.  CMCSA was down almost 10% in February on its highest monthly volume since late 2011 (its first negative month since August) after the news of its acquisition of Time Warner Cable.  The stock’s all-time high from Feb 12th is 55.28.

5.  FB – Stock was down 4 straight days including Friday’s loss, and is actually down 5 of the past 6 sessions since the WhatsApp announcement.  The March 70 calls were the most active line, trading almost 40k, though puts were more active than usual, trading over 200k vs. a 1 month average of 142k.

6.  DOW – Stock hit its highest level since 2005 last week.  The stock has been on a tear since Dan Loeb and Third Point announced the activist stake.  Morning seller of 16k of the Jan15 50 calls at 3.30, locking in some gains on the big move higher in the stock (up 10% in 2014).

7.  GILD – Buyer of 20k of May 80/70 put spread for 2.60 to open around noon.  GILD traded at a new all-time high on Feb 25th.  The stock closed 2013 at 75.10, and has not touched 70 since mid-December.