Options Trading News

October 23, 2012  Tue 10:56 AM CT

Yahoo is the only thing green in a sea of red after beating earnings expectations yesterday, and option trading is strong at midday.

YHOO is up 5.6 percent to $16.65, its best level since the 52-week highs of exactly a year ago. Shares were down near 52-week lows at the start of September, falling to $14.60.

More than 173,000 options have traded so far today, already quadruple its full-day average of 43,000 in the last month. Calls outpace puts with volume of 103,000 contracts, but not by much.

optionMONSTER's systems show that the most activity is in the November 16 puts, where more than 30,000 contracts have traded against open interest of 36,000. The largest print of 19,887 was sold for the bid price of $0.16, which may well be a trader selling protection that was held for a potential pullback on the earnings news.

The next biggest trade was in the January 15 calls, with 5,300 sold for $1.69, followed by a print of 5,000 January 16 puts. Both were below open interest, as it appears that much of today's trading involves the unwinding of positions in place before the quarterly report.
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