Monday’s Notable Options Activity: $F, $GPRO, $VALE, $ETP, $SYY

by Enis September 30, 2014 6:37 am • Commentary

After gapping down nearly 1%, the SPX clawed back to nearly unchanged by the close.  Options volumes lighter than last week

(Note:  the VIX trade referenced earlier was a fat finger, so that trade was not actually traded, and we’ve removed it from the post as result.)

1.  F – Ford lowered its profit forecast for 2014 as a result of weaker results in Russia, South America, and Europe, and higher-than-expected costs from recalls.  The stock closed at its lowest level in 6 months.  Calls traded nearly 3x as actively as puts, with the Dec 17 call the most active line, trading nearly 80k at an average price of 0.118.

2.  GPRO – GPRO has doubled since August 28th, or essentially in the past month.  The stock has more than tripled since its late June IPO.  Borrow has dried up, and even the Oct18th forward is trading around $86, meaning if you use options (buy put, sell call) to short, you are starting out about 6% in the hole on GPRO with less than 3 weeks to expiration (implying an annual borrow cost of over 100%).  Options traded over 3x the average 1 month volume, with the weekly 90 calls and the Oct18th 90 calls the most active lines.  30 day implied volatility in GPRO jumped to 87.

3.  VALE – VALE hit a new 5 year low, and is now down nearly 30% year-to-date.  Looks like a trader rolled down a put position, selling 10k of the Jan15 13 puts at 2.48 to close to buy 30k of the Jan15 10 puts for 0.45 to open.

4.  ETP – Seller of 9,671 of the Dec 60 calls at 3.30 to close to buy 20k of the Dec 65 calls for 1.45 to open.  Trader rolled that call position on a day that ETP hit its highest level since mid-2007.  The stock is within 2% of its all-time high of $64.

5.  SYY – Someone bought 12,670 of the Jan15 37/34 put spreads for 1.15 to open.  SYY has not touched $34 since December.  The stock is up 5% year-to-date.