Too Many Options: $BBRY, $EEM, $ELNK, $MSFT, $ORCL

by Dan March 31, 2014 5:37 pm • Commentary

Here is a list of some of the unusual options flow that caught our attention today:

1. ELNK – not a name we have ever spoken on RiskReversal, and frankly I am surprised the company is still in existence, but a large options trade went up this afternoon where a buyer paid .55 for 20,000 Oct 4 calls for .55 vs selling 1,000,000 shares of stock at 3.49, possibly stock replacement. There are only 62,700 of total open interest in the stock and this line is now the largest single line.

2. BBRY – the stock continued its earnings slide from Friday, down another 4% today, doing its best to hold at technical support from January around $8.  In the morning when the stock was $8, a trader bought a Sept/Jan 8 Put Calendar 25,000x for 45 cents.  The trader is making a bet that BBRY will be at or a little above $7 on September expiration.

3. VLO – on a day that saw oil stocks under-perform, there was a buyer of 10,000 of the VLO April 55/57 call spread for .47.  Break-even on the spread is 55.47, just below the 52 week high made on March 21st, with profits of 1.53 capped at or above 57.

4. COP – appeared that a trader rolled a short term bullish view up by selling 13,500 of the April 70 calls at 1.29 when the stock was 70.69 and then bought 13,500 of the April 72.5 calls for .27 to open.

5. ORCL – large cap tech stocks continue to show out-performance, especially relative to their high valuation peers.  ORCL today had a massive breakout on big volume to new 13 year highs.  One trader saw more upside as they paid .52 for 9400 April 41 calls.

6. MSFT – also closing at new long term highs (14 years), one trader looking for more upside, with defined risk, bought 8000 of the May 43 calls for .61 when the stock was $41.33.

7. VZ – stock saw some call buying today, but was likely over-writers closing short call positions vs long stock.  When the stock was 47.56, 10,000 of the June 50 calls were bought for .43 to close and later in the day when the stock was 47.68 there was a closing buyer of 10,000 April 47 calls for .85.

8. MET – this is what we call a “punt” in the business…..a trader paid .15 for 10,000 of the MET APril 4th (this Friday expiration) 54 calls when the stock was $52.99.  Break-even on Friday’s close is 54.15 up 2.2%.  What’s he or she know, or think they know???

9. EEM – the emerging market index continued its tear, up 7.5% since March 20th and options volume continues to run hot today at about 1.3x average daily volume with put and call volume about equal.  The strike with the most volume was the May 41.50 call where 163,000 traded on the day in some fairly large blocks of 80,000, 57,000 and 23,000, they look to all be sold (they were reported that way from the floors)between 1.00 and 1.03