Wednesday’s volatile session ended near flat, and the CBOE composite put/call ratio ended near even, at 0.95 on the session. The most active options names were not your usual suspects, and traders mostly focused on upside calls.
1. KO – The weekly 41.5 calls traded over 25k at an average price of 0.23 on the session, mostly buyer initiated (initial purchase was 13k for 0.19 when KO was trading 41.44). It’s bizarre to see such a short-dated option trade in a normally quiet stock. KO has traded between $41 and $42 for much of the past month. The stock has flirted with its July 1998 all-time high of $44.47 in the past 18 months, but has been rejected each time.
2. APC – Buyer of 10k x 20k x 10k of the Jan15 120/140/160 call butterfly for $2.30 in the morning. That trade breaks even at $122.30, which is around 15% higher than the stock’s current level. The all-time high of $113.51 was set in late August. The call butterfly buyer chose an optimal midpoint for the fly of $140, which is up more than 30% with only about 4 months to expiration.
3. FEYE – Buyer of around 10k of the weekly 36 calls for 0.60 in the afternoon. That line traded over 18k by the close at an average price of 0.72. No events are scheduled in FEYE over the next 2 days, but the buyer put up around $600,000 in premium for a 2-day option.
4. CX – Cemex is a Mexican cement company with rarely traded options in the U.S. Yesterday, there was a buyer of 33,500 of the Jan16 12 / 10 put spread paying 0.45 to open. CX has not traded below $12 since March, but there is a year and 4 months until Jan16 expiration.
5. BWP – Trader sold 28k of the Sept 17.5 calls at 1.05 to close, and bought 28k of the Mar 19 calls for 1.75 to open, rolling a long call position out and up. BWP’s high since its February gap down on its distribution cut is $20.51 from late August.
6. CNX – Three way bullish structure: trader sold around 13k of the Jan15 34 puts at 0.66 to buy around 13k of the Jan15 43/47 call spread for 0.63, essentially putting on the trade for even money. CNX has outperformed the broader coal sector in 2014, and is actually up 2% year-to-date. The stock’s high of the year is $48.30, while it last traded below $34 in November.