Tuesday’s Notable Options Activity: $BBBY, $COH, $FXI

by Dan April 22, 2015 8:20 am • Commentary

Here is some generally directional, untied options activity that caught my eye during Tuesday’s trading:

1. BBBY – reported disappointing fiscal Q4 results on April 8th and the stock declined 5.5% the next day. Yesterday when the stock was $72.73 a trader paid .59 for 10,000 Jan16 50 puts to open, these puts break-even down 32% on Jan expiration, a level the stock has not traded below since early 2011:

BBBY 5 yr chart from Bloomberg
BBBY 5 yr chart from Bloomberg

1. COH – total options volume ran 5x average daily with puts making up 80% of the volume, specifically May puts. When the stock was $41.86 a trader paid 1.30 for 5,000 May 41 puts (14,000 ended up trading on the day). There was also opening buyers of 3900 May 39 puts and 1500 of the May 41.50 puts. COH reports fiscal Q3 earnings April 28th.

3. FXI – with the Chinese equity etf up 24% on the year, consolidating recent gains after its explosive breakout, call activity ran hot yesterday, almost 3x that of puts.  When the etf was $51.50 right before the close, there as a buyer of 10,000 of the June 60/64 call spreads, paying 22 cents to open.  This trade breaks even at $60.22, up 17%, with a max gain of 3.78 at $64 or above, up 24%, at levels not seen since 2007:

FXI 10 yr chart from Bloomberg
FXI 10 yr chart from Bloomberg