BUZZ-Valeant options volume explodes as traders dive for cover

Wed Oct 21, 2015 1:34pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article
[-] Text [+]

** Short-seller Citron Research's report accusing Valeant Pharmaceuticals International Inc of fraud sends co's shares plunging and options traders looking for protection

** Options trading volume on Valeant jumped to all-time high with 140,000 contracts traded, or 6x the avg daily volume, making it the fourth-busiest single stock name in the options market on Wednesday

** Traders loading up on protective puts; some closing existing put positions for big profits

** Puts options volume was at 85,000 contracts; weekly $95 puts expiring Friday the busiest with 12,800 contracts traded

** Weekly $120 calls expiring on Friday also attract heavy volume with 6,600 contracts traded

** Notable bearish activity seen in options in last two weeks with Nov $145 puts the most actively traded contract making it the biggest block of open interest

** On Wednesday, Valeant's 30-day implied volatility jumps to 145.44 pct up from 61.65 pct on Tuesday, according to Livevol

** Valeant shares last down 39.5 pct to $88.77