Too Many Options: MSFT, YHOO, XLP, NRG, CVA, CDE

by Enis May 8, 2014 6:02 am • Commentary

Divergent performance between various pockets of the market continued yesterday, and single stock options volume was heavier in technology.

1.  MSFT – Trader sold to close 124k of the May17th 33 calls at 5.99, and bought to open 124k of the Aug 35 calls for 4.24, rolling a bullish position further out and locking in some profits.  MSFT is up 5% so far in 2014, outperforming the vast majority of Nasdaq peers.  The stock’s high so far this year is $41.66.

2.  YHOO – YHOO closed below its 200 day moving average for the second time in the past 2 weeks, trading over 60 million shares on the day.  The Jan15 40 calls traded over 50k at an average price of 2.55, mostly buyer initiated.  YHOO’s high of the year is $41.72 from January.

3.  XLP – The May17th 44 / Jun21st 45 call roll traded 50k times for 0.12.  XLP closed near its all-time high of $44.38, set in late April.  The consumer staples etf is up more than 10% since its early February low.

4.  NRG – The Sept 34 calls traded 40k for 2.27 and the Sept 27 puts traded 40k for 0.27.  NRG touched $35 yesterday for the first time since 2008, and is already up 22% so far in 2014.

5.  CVA – Seller of 18,650 of the Sept 20 calls at 0.45 to open.  CVA closed just below its 200 day moving average, and has not traded above $20 sine its large gap down in October 2013.  The stock reports earnings in mid-July.

6.  CDE – One of the worst performing stocks in the precious metals mining group, down 24% so far in 2014.  The stock hit a new 5 year low yesterday.  Trader rolled down puts, selling 20k of the Sept 10 puts at 2.25, and buying 20k of the Sept 8 puts for 0.925.