Posts Tagged ‘JNY’

Jones Group Options In Focus

JNY – The Jones Group, Inc. – Shares in The Jones Group dropped 10% to $13.66 on Friday morning, the lowest level since July 3rd, after Women’s Wear Daily reported that G-III Apparel Group Ltd. is no longer seeking to acquire the company’s apparel business, citing two sources. The sharp move in the price of the underlying sparked heavy trading in JNY options straight out of the gate this morning, with upwards of 4,300 contracts traded as of 11:00 a.m. EST versus the stock’s average daily volume of around 2,000 contracts.

Fresh interest in Nov $14 strike puts on JNY suggests some traders are bracing for shares in the retailer to extend losses next week. More than 1,000 of the $14 strike puts have changed hands against open interest of 594 contracts, and much of the volume appears to have been purchased at a premium of $0.50 each. Buyers of the $14 puts stand ready to profit at expiration next week in the event that Jones Group shares settle below the breakeven price of $13.50. 


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JPM Calls Active As Shares Hit Highest Since May

 

Today’s tickers: JPM, JNY & MW

JPM - JPMorgan Chase & Co. – Financial stocks are on a tear today after the ECB released details of its bond-buying plan amid a better-than-expected ADP report that showed private-sector employers added 201,000 jobs in August. Shares in JPMorgan earlier rallied to their highest level on an intraday basis since May 10th, climbing 4.7% to touch $38.87 in the first half of the session. Options traders positioning for shares in the name to extend gains in the near term pounced on the newly issued weekly contracts expiring one week from tomorrow. Call volume is on the rise at the Sep. 14 ’12 $38.5, $39 and $39.5 strikes. Roughly 1,400 calls changed hands at the $38.5 strike by midday, with much of the volume purchased for an average premium of $0.56 apiece. Traders long these in-the-money call options stand ready to profit next week should JPM’s shares exceed the average breakeven price of $39.06. Trading traffic spread to the Sep. 14 ’12 $39 strike where more than 3,100 contracts are in play. Overall options volume of 166,735 contracts as of 12:40 p.m. ET on JPMorgan is well above the stock’s average daily options volume of around 70,500 contracts. Calls are more active than puts, with the call-to-put ratio hovering around 1.6.

JNY - The Jones Group, Inc. – Apparel and accessories retailer, The Jones Group, Inc., is seeing heavier than usual options activity today, with shares in the name rallying 3.5% to an intraday- and new 52-week high of $13.38 in the first half of the trading day. The company was scheduled to present at the Goldman Sachs 2012 Global Retailing Conference ahead of the opening bell this morning. One options trader appears to be positioning for shares in the name to potentially rise to their highest level since April 2011 by October expiration. It looks like the strategist purchased a 657-lot Oct. $12/$15 call spread for a net…
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Industry Acquisition News Spurs Activity in Brookdale Options, Sends Shares Soaring

Today’s tickers: BKD, COH, CNP, JNY, SBUX, XRX & SLB

BKD - Brookdale Senior Living, Inc. – Shares of the operator of senior living communities are up 18.7% at $19.74 this afternoon after earlier rallying as much as 20.4% to an intraday high of $20.03. Brookdale’s shares jumped after Ventas Inc. agreed to purchase the real estate assets of Atria Senior Living Group for $1.5 billion in cash and stock. The acquisition sent shares in Brookdale, the largest owner of senior communities in the U.S., higher on sentiment the stock is undervalued and spurred bullish trading in its options today. One options strategist utilized longer-dated calls and puts to position for shares to continue their ascent. The trader purchased 1,745 calls at the January 2011 $20 strike at a premium of $1.60 each, and sold the same number of puts out at the April 2011 $17.5 strike at a premium of $1.30 apiece. The cost of buying the call options is reduced to just $0.30 per contract, thus positioning the investor to make money if BKD’s shares rally above the effective breakeven price of $20.30 ahead of expiration day in January. The sale of the put options is a nice way to cheapen the cost of taking a bullish stance on Brookdale, but is not without its risks. The trader could have 174,500 shares of the underlying stock put to him at $17.50 each if the puts land in-the-money at expiration in April 2011. But, the $1.30 premium per contract received for bearing this risk appears to be a favorable trade off for this bullish player.

COH - Coach, Inc. – The luxury retailer of handbags and accessories popped up on our scanners this morning after one investor dabbled in near-term put options. Coach’s shares are currently up 0.50% to stand at $44.64 as of 12:55 p.m., but earlier rallied more than 1.20% to touch an intraday high of $44.96. The near-term pessimistic play observed in the November contract today may be the work of…
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Cautiously Optimistic Player Enacts Delta Neutral Hedge Ahead of Oracle Earnings

Today’s tickers: ORCL, DV, JNY, HOG, FDO & UA

ORCL – Oracle Corp. – Shares of the software company rallied as much as 1.45% this afternoon to touch an intraday high of $25.75, which is just $0.88 below the stock’s current 52-week high of $26.63. Options activity on Oracle is quite active ahead of the firm’s first-quarter earnings report scheduled for release after the closing bell tomorrow evening. One options investor hoping to see Oracle’s shares extend gains through the start of 2011 initiated a delta neutral hedge in the January 2011 contract. It looks like the trader purchased a total of 12,500 puts at the January 2011 $21 strike for a premium of $0.45 apiece, tied to the purchase of a large number of ORCL shares for $25.65 each, on a 0.15 delta. The long position in shares suggests perhaps that the investor expects tomorrow’s earnings report to lift shares and/or foresees continued bullish movement in the price of the underlying stock over the next 5 months. But, the put options serve as a type of insurance policy for the trader in case Oracle’s shares falter going forward. Options investors exchanged more than 77,800 contracts on the software maker by 3:10 pm ET.

DV – DeVry, Inc. – The for-profit operator of colleges and universities popped up on our ‘hot by options volume’ marker scanner after one investor initiated a call spread in the November contract. DeVry’s shares fell as much as 2.9% in the first half of the trading session to touch down at an intraday low of $41.25, but made a strong recovery in early afternoon trading, and currently stand 1.25% higher on the day at $43.01 as of 12:52 pm ET. The investor populating the November contract wisely established a contrarian debit call spread on the stock when shares were still in the red. The options strategist purchased 2,000 calls at the November $45 strike at a premium of $2.00 each, and sold the same number of calls at the higher November $50 strike for premium of $0.65 apiece. Net premium paid to purchase the spread amounts to $1.35 per contract. The investor is positioned to make money if DeVry’s shares rally another 7.8% over the current price of $43.01 to surpass the effective breakeven point at $46.35 by expiration day in November. Maximum potential profits of $3.65 per contract are available to the call-spreader if…
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