Tuesday’s Notable Options Activity: $AAPL, $EBAY, $ABBV, $AAL, $ADBE, $FTNT

by Enis October 22, 2014 7:40 am • Commentary

VIX spot has made a round trip from 16 to 31 and back to 16 in less than 2 weeks.  The S&P 500 index has been volatile on the way up as well as down, so 10 day realized volatility is still around 20, even as implied volatility has fallen to 14.  Tech stocks were the most active in the options market yesterday.

1.  AAPL – Stock rose 3% on earnings, remaining just slightly below its all-time high of $103.74 from September.  Calls were once again more than 2x as active as puts, though implied volatility dropped from around 28 to 20, so short-dated upside calls generally lost value despite the move higher.  The Nov22nd 105 calls traded over 55k.

2.  EBAY – EBAY has risen 6% this week after the large volume decline on earnings last week.  Buyer of 20k of the Nov28th 51 calls for 1.29 to open yesterday morning.  EBAY’s bounce in the past week has kept the $48 to $58 range in tact.

3.  ABBV – ABBV has recovered above the $55 level this week after last week’s selling on the break of the Shire deal.  Buyer of 10k of the Feb 55 / 62.5 call spread for 2.60 to open.  ABBv’s all-time high is $60.02 from September.

4.  AAL – AAL has bounced more than 20% in the past week.  There was a seller of 8k of the Nov 38 calls at 1.90 in the afternoon.  The original buyer paid 0.45 for 16k on October 14th, so that is a very nice gain in just a week.

5.  ADBE – Buyer of 5k of the Dec 70 calls for 1.55 to open.  ADBE reports earnings on December 11th.  The stock’s high of the year is $74.69, and it has not traded above $70 since earnings disappointed in September.

6.  FTNT – Buyer of 15k of the Nov 27 / 29 call spreads for 0.49 in the afternoon.  FTNT’s high of the year is $26.84.  Fortinet is a network security software company, and reports earnings today after the close.  The stock is up 32% year-to-date, and its all-time high is $28.82 from April 2012.