ODP – Office Depot, Inc. – Investors populating the provider of office supplies and services have had a change of heart since yesterday when we reported that bearish players were selling call options in the November contract. Bulls are dominating trading activity in Office Depot options today with shares trading higher by 8.6% as of 12:35 pm ET to stand at $4.66. More than 12,600 contracts, nearly all of them call options, changed hands on ODP thus far in the session. Investors hoping to see shares continue to climb picked up approximately 3,200 calls at the October $5.0 strike for an average premium of $0.13 apiece. Optimism spread to the November $5.0 strike where another 3,600 calls were scooped up at an average premium of $0.26 each. November contract call buyers are poised to profit should Office Depot’s shares rally another 12.9% to surpass the average breakeven price of $5.26 by expiration day. The sharp rally in shares coupled with rising demand for options on the stock lifted ODP’s overall reading of options implied volatility 13.2% to 63.96% by 12:40 pm 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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