Too Many Options: $C, $JNS, $LNG, $SM, $DOW, $PVH, $TWTR

by Enis August 27, 2014 6:05 am • Commentary

Just when it seems like volumes cannot get any lighter, stock and options volumes hit new lows.  Yesterday was one of the lowest of the past year.

1.  C – Citigroup touched $52 for the first time since mid-January, as financials continued to lead the latest move higher.  Buyer of 13k of the Oct 55 calls for 0.38 in the morning.  That line ended up trading over 30k at an average price of 0.41 on the day.  C’s 52 week high is $55.28 from early January.

2.  JNS – Trader rolled a put position from Sept to Oct, selling 30k of the Sept 12 puts at 0.265, and buying 40k of the Oct 11 puts for 0.30 to open.  JNS has not traded below $11 since April.  The stock is down 1% year-to-date.

3.  LNG – Trader sold 8k of the Oct 75 calls at 5.30 to buy 14k of the Oct 80 calls for 2.875 to open, rolling a call position higher as LNG hit another new all-time high yesterday.  The stock is up 80% year-to-date, and there are still about 2x as many calls as puts outstanding in the options market.

4.  SM – Someone sold 20k of the Sept 75 puts at 0.30 to close, and bought 10k of the Oct 80 puts for 2.30 to open.  SM is up 2% year-to-date.

5.  DOW – Seller of around 4,426 of the Jan15 52.5 puts at 2.52 to buy 13,278 of the Jan15 57.5 calls for 0.84, traded midday.  A total of about 6,500 of the puts and 20,000 of the calls traded in total.  DOW’s all-time high is $56.75 from March 2005.  The next earnings report is in late October.

6.  PVH – Looks like another roll – the Sept 115 calls trade 16k at 6.40, and the Jan15 115 calls trade around 12k for 9.60, closing Sept and opening Jan15.  PVH is down 13% year-to-date, but the stock has rallied 10% from its early August low.

7.  TWTR – Stock closed at its highest level since March.  Calls traded nearly 3x more than puts, with the Sept 50 calls the most active line, trading around 14k at an average price of $0.88.  30 day implied volatility bounced to 37 after hitting a 1 year low of 35 last week.