Between 11:30 and 1:30 p.m. New York time Wednesday, seven options with a high ratio of volume to open interest were detected. With the market volatile, it's crucial to stay informed on the latest options trends.
Of the seven, a block trade for 11,646 $TAL Education (TAL.US)$ call options expiring in 72 days stood out, far exceeding its open interest of 101. That took the volume of that contract to about 115.31 times that of the open interest. The seller stands to collect a premium of $361,030 for the transaction covering options that give the buyer the right to buy about 1.165 million TAL shares at $16.00 each by July 19.
Another option trade worth noting involves $Norfolk Southern (NSC.US)$ put contracts. A block trade of 1,100 puts expiring in nine days was posted. That far exceeds its open interest of 23. That transaction boosted the volume to 47.83 times the contract's open interest. The seller stands to collect a premium of $137.500 for the transaction. The put options give the holder the right to sell 110,000 Norfolk Southern shares at a strike price of $222.50 per share by May 17.
There is also a notable transaction on $Lucid Group (LCID.US)$ put contracts expiring in 590 days. That block trade was for 5,000 puts, far exceeding its open interest of 216. The trade took the volume to 23.15 times the contract's open interest. The buyer paid a premium of $195,000 for the trade. The contract gives the holder the right to sell 500,000 Lucid shares at a strike price of $1 each before it expires on Dec. 19, 2025.
See below for more unusual options activities.
Notes:
Unusual options activity identifies a single option trade with a volume-to-open-interest ratio (V/OI) equal to or above 10, which means the volume of the trade is much higher than the existing positions. High V/OI often implies that a trader is opening a new position with an unusual amount. Options activities are filtered based on the following criteria:
Options trade with V/OI≥10, while OI of the contract must be ≥10.
Options trade with premium≥$50,000.
The underlying asset of selected options must be individual stock with a market cap≥$5 billion.
If there are at least 3 or more trades that meet all the criteria in the corresponding time period, an article will be generated at 11:30, 13:30, and 16:30 ET each trading day.
Options trading entails significant risk and is not appropriate for all customers. It is important that investors read Characteristics and Risks of Standardized Options before engaging in any options trading strategies. Options transactions are often complex and may involve the potential of losing the entire investment in a relatively short period of time. Certain complex options strategies carry additional risk, including the potential for losses that may exceed the original investment amount. Supporting documentation for any claims, if applicable, will be furnished upon request.
The past performance of a security or financial product does not guarantee future results or returns. Customers should consider their investment objectives and risks carefully before investing in options. Because of the importance of tax considerations to all options transactions, the customer considering options should consult their tax advisor as to how taxes affect the outcome of each options strategy.