Popular (BPOP) - Option Order Flow Continues; Stock Up 55%

Discussion in 'Options' started by livevol_ophir, Mar 22, 2010.

  1. livevol_ophir

    livevol_ophir ET Sponsor

    BPOP is trading 2.63.

    I've noticed this stock for the last few days (last week) and have been tweeting about it (@Livevol_Pro). The trade today with the 55% jump in price in a month makes the trend worth a write up. BPOP is a diversified bank holding company.

    The company has traded 10,000 options in the first hour on total daily average option volume of just 468. All 10,000 contracts are calls. The trade was a May 2.5/Oct 3.5 call spread bought(buy May/sell Oct) for $0.075 (splits in Oct). The Stats Tab and Day's biggest trades snapshots are included (in the article). I have also included the 20 largest option trades on Friday 3-19-2010 - also call spreads (in the article).

    The Options Tab (click to enlarge) illustrates that the calls are all opening (compare OI to trade size).

    Finally, the Charts Tab (6 months) is below (click to enlarge). The top portion is the stock price, the bottom is the vol (IV30&#8482 - red vs HV20&#8482 - blue). The yellow shaded area at the very bottom is the IV30&#8482 vs. the HV20&#8482 vol difference.

    You can see the stock has gone up 55% since early last month.

    The May/Oct call spread is cheap. If the stock trades below 2.5 after May expo, then the position is naked short 5,000 calls (assuming no other positions). But, if the May calls are exercised (stock trades above $2.50 on May expo) then it's a nice cheap bet. Keep in mind, if the stock is below $2.50 on May expo, the Oct calls are gonna be cheap to buy back as well so the "naked" short isn't as "scary."

    This is trade analysis, not a recommendation.

    Trades, prices, charts, vols, order flow here:
  2. It would be more impressive if it weren't a penny-stock. :cool:
  3. livevol_ophir

    livevol_ophir ET Sponsor

    Yeah - these stocks are more like options themselves - but it can be fun to load up long with limited downside...