Call Traders Flock to Anadarko Petroleum

APC – Anadarko Petroleum Corp. – Frenzied call buyers flocked to the independent oil and gas exploration and production company today on speculation Australian firm, BHP Billiton Ltd., may be interested in buying the company. Anadarko’s shares surged 5.1% to an intraday high of $51.29 in morning trading. Investors populating APC options today flooded September contract calls to prepare for the price of the underlying stock to continue higher ahead of expiration. Shares are likely to extend gains if additional takeover rumors hit the air-waves or if an actual bid is announced. Trading traffic is heaviest in September $55 strike calls where more than 9,000 contracts changed hands by 12:20 pm ET. At least 4,000 of those call options were purchased at an average premium of $0.51 each. Call buyers also picked up around 2,000 calls for premium of $1.01 a-pop at the September $52.5 strike, and scooped up 2,900 now in-the-money calls at the September $50 strike for an average premium of $1.85 each. Bullish sentiment spread to the November $55 strike where traders purchased approximately 3,000 calls for an average premium of $2.29 each. Options implied volatility, helped higher by unconfirmed takeover chatter, rose 11.9% to 51.43% in early-afternoon trading.

About Andrew Wilkinson 1023 Articles

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.

Interactive Brokers: Interactive Brokers offers direct market access to around 80 electronic global markets from a single account. Successful traders and investors understand that superior technology and lower trading costs can result in greater returns. For 32 years we have been building direct access trading technology that delivers real advantages to professionals worldwide. With consolidated equity capital of US $4.4 billion, IB and its affiliates exceed 1,000,000 trades per day. In addition, our prudent and conservative risk policies make Interactive Brokers a safe haven for your money. Discover some of the reasons why IB, the largest independent US broker/dealer, is the professional traders' and investors' choice.

Visit: Interactive Brokers

Be the first to comment

Leave a Reply

Your email address will not be published.