Tuesday’s Notable Options Activity: $BABA, $HLF, $QCOM, $CMCSA, $BBRY, $MBI

by Enis November 5, 2014 6:35 am • Commentary

Overall market volumes remained subdued, with the VIX closing below 15 for the 4th straight session.  A good portion of the single stock options activity was in stocks reporting earnings.

1.  BABA – BABA closed at a new high, and calls traded twice as actively as puts.  The Nov22nd 110 call line was the most active, trading nearly 30k at an average price of $1.36.  The option closed at 1.90, vs. a 1.80 close on Monday prior to the earnings release, a reflection of the large drop in implied volatility in BABA after the event.

2.  HLF – Puts traded over 110k on the session, vs. the 1 month average of around 13k.  Implied volatility remained elevated (30 day at-the-money implied vol closed near 87) even after the earnings event since HLF declined more than 20% yesterday.  The Nov22nd 35 puts traded over 27k at an average price of 0.64.  The 52 week low from September is $38.63.  See Dan’s MorningWord from yesterday for more details of the current backdrop surrounding HLF.

3.  QCOM – 10k of the Dec20th 80 calls trade for 0.77 in the morning.  QCOM reports today after the close.  I previewed the earnings event yesterday.  We are considering some trades in the name, and will update later today if we pull the trigger.

4.  CMCSA – Buyer of 30k of the Apr 57.5 / 62.5 call spreads for 1.20 in the afternoon.  CMCSA’s all-time high is $57.49 from September.

5.  BBRY – Buyer of 30k of the Jan15 8 / 7 put spreads for 0.15, possibly rolling up from the 7 to the 8 strike.  BBRY has not traded below $8 since June.  BBRY’s next earnings report is on Dec. 19th.

6.  MBI – Seller of over 16k of the Jan16 10 puts at 2.30 midday.  MBI hit an 18 month low of $8.41 in mid-October.  The company reports earnings today after the close.