It was the largest down day for the S&P 500 index since May 20th, though down 0.35% on the day. VIX spot still closed below 12, though there was a large put trade in the housing-related ETF, XHB.
1. XHB – Buyer throughout the day of over 150k of the Dec 26 puts for 0.425 average price. That’s around $6.5 million in total premium, and the trade is only profitable if XHB trades below $25.575 by December expiry. XHB last traded below that level in December 2012. Implied volatility between 0.5 and 1 point higher 6 months out, depending on the strike. Jeff Gundlach recommended a short XHB position at the May Ira Sohn conference.
2. ATML – The breakout rally in ATML continued. Dan laid out the heavy call volume on Tuesday in a NTT post, which pumped implied volatility in the stock. In that post, he highlighted some unusual options activity in ATML, with 12k of the Aug 10 calls being bought,
3. ARCP – The Jan15 12.5 call option volume continued to be active on this REIT, with a seller of 50k at 0.45 in the morning. The stock closed below $12 for the first time since late 2012.
4. FTK – Flotek is up nearly 50% so far in 2014, and has been on a tear ever since its 2010 bottom. Over 100k puts traded on Wednesday. The Sept 28/25 put spread traded 26k times at 0.85, and the Dec 28/25 put spread traded 26k times for 0.85. FTK last traded below $25 in February.
5. CX – Buyer of over 20k of the Jul19th 14 calls for an average price of 0.24 throughout the day. Cemex is one of the largest building products companies in EMEA. The ADR is trading near a 5 year high, and the company reports earnings just before July expiration.
6. AVNR – $1 billion market cap biotech company. When stock was 5.
7. HUN – Seller of 19,100 of the August 27 puts at 0.69 average price, looks like to close. HUN is trading near its all-time high of $30.
8. TAP – Takeover speculation picked up in TAP yesterday. The Oct 75 calls traded over 17k on the day at an average price of $2.04, mostly buyer initiated. Stock hit a new all-time high, and implied volatility reached its highest level in a year.