Choices merchants speculate on rising Tesla opponents

Electric vehicle manufacturer based in China Nio Inc (NYSE: NIO) is one of the best performing stocks on the New York Stock Exchange today. On its most recent review, it was up 8.7% to $ 49.01 and is targeting its highest closing price since March 1st. NIO is up 26.9% last month and up 609.7% year-to-date. As a result, options traders have become aware of competitor Tesla (TSLA).

NOK chart June 2nd, June 28th

In response to today’s price movement, 310,000 calls and 111,000 puts have crossed the band, almost double the average intraday volume. The most popular is the weekly 7/2 50 strike put, followed by the 48 strike call from the same series, opening positions in both.

According to Nio stock’s 10-day call / put volume ratio of 3.28 on the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), calls have been the most popular choice recently . This ratio is over 79% of the readings from last year, suggesting that calls are being answered faster than usual.

These traders have chosen an opportune time to speculate with options on NIO, as rewards are currently available for a bargain. The Schaeffer’s Volatility Index (SVI) of 55% for the stock is above just 2% of its values ​​for the past 12 months, which suggests that the options market is currently pricing in relatively low volatility expectations.

Also are Nio stocks Schaeffer’s Volatility Scorecard (SVS) is 100 out of 100 possible. This means the stock has managed to beat volatility expectations over the past year – a boon for option buyers.

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