Thursday, February 10, 2011

Option Flow Recap for Febuary 10, 2011

Macro / Thematic

SPY – The March 122/125/128 put fly was bought for $0.23; 25,000 x 50,000 x 25,000. The trade makes money with SPY trading on March expiration between 122.23 and 127.70, paid 0.23 with the biggest profit potential of 2.77 with SPY closing on March expiration at 125.00. Limited risk trade. Risk is the debit paid for the fly (0.23).

QQQQ – 5000 of the March 57 / 54 put spreads were bought for $0.55

EWZ - Vol buyers in EWZ (Brazil) betting on volatility to expand.


MDS – Bullish trade in Midas today with 6000 of the June 7.5 calls bought for $1.10 to open

GME – A lot of bullish option flow in Gamestop today with 28,000 calls and only 3700 puts trading. March 20 and February 21 calls are the most active with over 4700 and 4600 trading respectively almost all bought to open. Earnings are due mid March.

LOW - Size call buyers in January (could be closing) 10k January 35 Calls for 0.18.

BBY March $30 puts 5k vs OI 1,590

DKS traded 13409 February $38 calls against OI of 368, crushing IV by opening sellers seeing limited near term upside for shares

PAY buyer of 2,000 May $43 calls @ $3.10, stock near a breakout of a cup and handle pattern

COH volatility sale of 2,000 March $57.50 straddles sold @ $3.65

F  13,000X, March/May $17 calendar call spread

NILE IV30 up 6.5% in front of earnings, options volume 10X average with 3,434 calls and 4,281 puts.  February $60 puts trade 2,500 and some 65/60 put spreads bought.

CL options active again, a few days after a report that Unilever (UL) should look to buy the Company. The May $70 puts have been sold for more than 6,000 contracts while a block of 6,000 May $85 calls was bought, shares at $77.50. With a market cap of $37.8B this would be a huge deal.   

GES  3 way trade in March, trader sells 2,000 March $40 puts at $0.50 and buys the March $45/$50 ratio call spread 1,000X2,000 at $0.97.

MICC block of 4,000 April $105 calls bought at $0.70 and 900 April $90 puts sold at $3.30.


HK – 20,000 of the June 30 calls were bought for $0.15. The bullish activity in the name comes the day after Encana (ECA) , Petrochina deal was announced.

RRC – 2500 of the September 70 calls for $0.75.

TLM – 5000 of the April 21 puts were bought for $0.65.

MUR 800 March $80 calls bought @ $0.20


RVBD - Bearish activity in RVBD: put spread buyers. 1400 March 35 / 40 put spreads were bought for 1.45.

EMC – Large call spread traded today. 30,000 of the April 24 / July 29 call spreads were bought for $2.03. The position appears to be a roll up strikes and out several months.

RIMM – Option activity picked up significantly in the afternoon after the company announced plans for the playbook software to run Google Android apps. 125,000 calls and 55,000 puts traded on the day. The weekly contracts were very active with 17,000 of the February (2/11 expiration) trading.

SYMC with 2,000 March $20 calls bought here and IV pushing higher, frequent chatter name

CHKP block of 10,200 January 2012 $47.50 calls bought at $6.20 offer to open, huge trade size, with the January 2012 $40 calls being closed and rolled to this strike, some profit taking but remaining very bullish

MSFT bouncing off re-test of major breakout level, and around 7,500 Feb. 28 calls bought 11 cent offer

JDSU huge call volume with 60,000 trading, 10X average and big buyers in June $30 calls, as well as 3,120 June $22.50 calls rolled out to the $27 strike

JNPR April 43/36 bull risk reversal traded 2,250X at $1.97

Materials / Industrials

AA – The February 16 puts were very active today with over 32,000 trading (89% on the offer) and given the open interest in the name, most are to open. The option players are paying $0.04, $0.05, and $0.06 for an option that is 6.4% out of the money and expires in 9 days (including the weekend).

ITT block of 400,000 shares short @ $59.10 along with 5,000 July $60/$50 collars, bear collar position on short stock

BEN  trading 10X daily call volume, selling 2,830 Jan. 2012 $100 calls and rolling to 4,325 January 2012 $125 calls

KIM – 4800 of the April 20 calls were sold at $0.25 to open. 

NDAQ roll of 2,145 Feb. 24 calls to March $25 calls. Exchange stocks have been hot as of late

BRCM sale of 8,000 March $43 straddles at $3.27, tied to 120,000 shares of stock bought at $43.65


SQNM – 3000 of the March 8 calls were sold at $0.22. It appeared to be a call writer taking advantage of the strength in shares today.

MHS – 5000 of the January 55 / 72.5 bearish risk reversal traded for $1.10. The trade was tied to 296,000 shares at $61.88. The company reports earnings on February 22nd.

PRGO trading 15X daily call volume as 1,500 Feb. 65 calls are rolled to May $65's

*Special thanks to Flotilla Partners, Option Radar, BMO Capital, LiveVolPro, CBOE, Option Monster, and all of the options desks and traders we work with to provide the option flow!

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