ATVI (Activision) - Half a Million Calls Trade on 5k Average

Discussion in 'Options' started by livevol_ophir, Aug 23, 2010.

  1. livevol_ophir

    livevol_ophir ET Sponsor

    ATVI is trading $10.90, down 1.4% with IV30&#8482 up 0.8%.

    <img src="">

    This color comes from Darren Story, Student Options:
    ATVI Customer:
    bot 125,000x feb 12c ~ .62
    bot 62,500x feb 14c ~ .20
    bot 62,500x feb 15c ~ .11
    sld 250,000x feb 13c @ .37 , xx-all CBOE

    The company has traded over 500,000 options on total daily average option volume of just 5,959. The largest trades are listed above. The Stats Tab and Day's biggest trades snapshots are included (<a href="">in the article</a>).

    <img src="">

    The Options Tab (<a href="">in the article</a>) illustrates that the everything is mostly opening (obviously).

    Let's take a look at the PnL chart at expo. (<a href="">in the article</a>) for Feb'11.

    Breakeven Low: $12.03
    Breakeven High: $13.96
    Max Gain: $12,078,000
    Max. Loss: $6,687,500

    Not much else to say other than, wow... This is a gigantic bullish bet that ATVI goes to $13 (short strike).

    This is trade analysis, not a recommendation.

    Details, trades, prices, vols, charts here:

    Legal Stuff:
    <a href=""></a>
  2. livevol_ophir

    livevol_ophir ET Sponsor

    Wonder if this was negotiated with the exchange given the size; permission for that kind of OI in something this thinly traded.
  3. IV too low, not enough compensation for the risk with ATVI.

    I would rather sell the Sep 57 IWM puts for a buck. Much better risk compensation than a ATVI Buy write, where you take much more risk but not compensated enough for the additional risk.