EPI, GS Options – Unusual Trading Activity – August 25, 2014
This week we’re taking a look at unusual options trading activity in WisdomTree India Earnings ETF (EPI) and Goldman Sachs (GS).
As many of you know, unusual options volume can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term.
This is something professional options traders pay a lot of attention to, and for good reason… Unusual options activity can “tip off” big moves in a stock, either up or down.
So let’s take a look at some ‘interesting’ activity that caught our eye this week:
WisdomTree India Earnings ETF (EPI)
Some traders may be concerned India stocks are due for a selloff.
EPI, a popular India stock ETF, is currently trading for $22.73. The price is 77% above the 52-week low of $12.83 and is just 3% below the 52-week high of $23.50.
A large bearish trade hit the wire in EPI options, consisting of 10,000 September 22 puts bought for a price of $0.27. Judging by the open interest, it was clearly an opening trade.
I know $0.27 seems like a cheap price to pay for puts so close to the money with about a month to expiration. However, EPI doesn’t move all that much and hasn’t been below $21.50 since May. A large put trade like this could also be a hedge.
Goldman Sachs (GS)
If options action is any guide, Goldman shares could be getting a boost.
GS is trading for $178.83, basically flat on the year. The shares are just 1% below the 52-week high of $179.91 and 20% above the 52-week low of $149.82.
Around 7,000 September 180 calls were purchased between the prices of $1.70 and $2.24. The volume today doubled open interest, so once again, this looks like opening activity.
GS has struggled relative to the overall market this year as major financial institutions have been under fire from the Department of Justice. It appears that traders believe the big banks like Goldman could be ready for a surge.
More Options Ideas…
That wraps up this week’s unusual options trading and volume…
Keep in mind, there’s a lot more unusual options activity going on than what we discuss here.
We just try to bring you what we feel are the most significant ones– and the ones you might actually be able to make some money on!
So keep an eye on your email inbox… we have a lot more options trading ideas coming your way!
Yours in Profit,
Gordon Lewis
Category: Unusual Options Trading Activity
