OptionsHouse

Options Trading News

December 6, 2013  Fri 11:37 AM CT

WDAY: SEE CHART GET CHAIN FIND STRATEGIES
A long-term trade is looking for cloud-computing company Workday to make a big move higher or lower in the next two years.

optionMONSTER's Depth Charge system detected the purchase of 5,000 January 2016 40 puts for $2.60 today, dominating WDAY's option volume and already topping its total daily average in the last month. The previous open interest at that strike was just 5 contracts, so this is clearly a new position.

Just after the puts were bought, a block of 40,000 WDAY shares was bought for $82. The combination of stock and options creates a delta-neutral position that is looking for a big move up or down in the shares and/or for volatility to be higher than that implied by the option. (See our Education section)

WDAY is down 0.48 percent to $81.43 this afternoon. The stock has been testing resistance at $82 since closing above that price back in mid-September. It bounced off support at $72 two weeks ago. 
Share this article with your friends


Invest Like a Monster - San Antonio: October 9-10

Premium Services

Archived Webinar

Education & Strategy

Real vs. Synthetic

We now know that there are two ways of creating a call position, a put position, and a stock position. We can simply use the actual real security or we can recreate it synthetically. We can create these positions in both long and short forms and this ability sets up an interesting scenario--an arbitrage!

View more education articles »