OptionsHouse

Options Trading News

December 5, 2012  Wed 9:59 AM CT

ACAD: SEE CHART GET CHAIN FIND STRATEGIES
Acadia Pharmaceuticals has slipped back below a key $5 level, but today's option activity is topped by large call trade.

optionMONSTER's systems show that a trader sold 7,500 December 2.50 calls against open interest of more than 18,000. At the same time, he or she bought 7,500 January 2014 4 calls for the ask price of $1.95 in volume that dwarfs open interest of just 3 contracts, so this is new activity.

If the December calls were sold to open a new position, this is a diagonal call spread. But it seems much more likely that this is a roll, with the trader selling the in-the-money calls that will expire in a few weeks and opening the position out more than a year to take advantage of any further gains.

ACAD is down 4 percent to $4.80 this morning. The stock gapped up last week from just above $2 to a high of $6.54 on positive news about an antipsychotic drug that it is developing. Shares slipped but have still been closing at or above $5 since then.

More than 20,000 ACAD options have already changed hands this morning, more than twice its daily average over the last month.
Share this article with your friends


Related Stories

ACAD

Acadia Pharma faces downside position

April 25, 2016

The drug developer is up 49 percent in the last month but is drawing bearish option activity ahead of its expected earnings report in early May.

OptionsHouse

Premium Services

Education & Strategy

The Problem with Trading Earnings

AP Options specializes in Swing Trading. Swing trading is the art of locating short term, quick, aggressive movements in a stock normally created by the technicals but, can be sometimes created by the fundamentals. These trades, at least in this service, last a couple of days to a week in the majority of cases.

View more education articles »