AKAM – Akamai Technologies, Inc. – Bullish players are dominating trading activity in Akamai Technologies’ options this morning due to reports of renewed takeover chatter. Investors expecting AKAM’s shares to climb higher are scooping up call options in the August and September contracts. The firm’s shares are currently up 2.8% on the day to arrive at $45.30 as of 11:30 am ET. Traders purchased at least 4,200 now in-the-money calls at the August $45 strike for an average premium of $0.45 apiece. Call buyers at this strike make money if, by expiration tomorrow, Akamai’s shares exceed the average breakeven price of $45.45. Optimism spread to the September contract where traders picked up 1,100 call options at the September $49 strike for an average premium of $0.69 a-pop. Investors long the September $49 strike calls are positioning for AKAM’s shares to rally to a new 52-week high by expiration day next month. The current 52-week high on the stock is $46.72, but the price of the underlying stock would need to surge 9.7% over the current price of $45.30 in order for shares to surpass the average breakeven point on the calls at $49.69. Investors hoping AKAM’s shares rally more dramatically purchased 3,200 calls at the sky-high September $55 strike for an average premium of $0.20 each. More than 5,390 calls changed hands at the September $55 strike by 11:40 am ET. AKAM’s shares must increase 21.9% in order for September $55 strike call buyers to start to amass profits about the effective breakeven price of $55.20 by expiration next month. Takeover speculation and increased demand for options on the provider of services for improving the delivery of content and applications over the Internet lifted the overall reading of options implied volatility on the stock 11.6% to 47.13% as of 11:45 am ET.
Affiliation: Interactive Brokers
Andrew Wilkinson is the senior market analyst at Interactive Brokers Group, where he provides daily commentary and analysis on U.S. equity options trading throughout the trading day. Andrew provides webinars designed to explain option-related trading scenarios covering futures, fixed income, forex and equities.
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