Apple reports earnings after the bell Thursday, and options traders are leaning into the stock’s recent strength, with big-money traders buying in-the-money calls and speculators looking for a ramp to new highs by this Friday, according to trades put on before the market close Friday, and open interest that’s built up around the stock this summer.
Of the $590 million in options premium traded on Apple Friday, $442 million was tied to calls, according to SpotGamma. Traders bought almost 560,000 calls, compared to just 332,00 puts, ThinkOrSwim data show. Perhaps more importantly, options prices currently imply an almost 4% move for Apple after earnings, an unusually large move considering the average historical 1% swing over the past year, according to Cboe LiveVol data.
The biggest trade in Apple Friday was someone opening a new position in $2.6 million of 280-strike calls in Apple expiring mid-August, a bullish position with a delta near one, meaning the trade acts as stock replacement for the owner.
The strike with the biggest open interest in options expiring this Friday is at $320, with 13,000 calls 5,000 puts, according to data from BarChart. That suggests even if the earnings don’t lead to a rally, investors are confident last week’s lows will hold.
The most popular contract expiring Friday by volume bought on Friday was the 300-strike put, with 7,500 contracts traded but for just $374,000 in total premium. The second-most popular was the 340 strike call with 5,000 contracts totaling $2.3 million in premium, SpotGamma data show.
That contract goes for $4.25 as of Friday’s close, meaning buyers need Apple to rally 3.4% this week to beyond its all-time high of $335.
Apple options are doing something unusual into earnings
byu/app1310 instocks
Posted by app1310
4 Comments
oh no, the 37 forward p/e 5 trillion stock has people buying downside protection going into earnings. That’s just so weird man. Good talk
Apple doesn’t invest in AI with huge capex. It’s a safe haven in the Mag7/bag7. Money has to go somewhere into earnings. Rotation. Sell before earnings to avoid IV crush.
Apple Revenue is stale for 4 years.
The only reason it’s now slightly increasing is the 20% price hike due to memory, but revenue is down 20% QoQ
China has 55% of the global smartphones. Apple doesn’t want to publish the number of iPhones sold, only the revenue is published.
I don’t see why Apple is priced at 40 PE. Arguments like “People will always buy iPhone” is not enough in this price level.
Their last invention called Apple Vision Pro was worse than Metaverse.
Could very, very easily see this as a rug pull. Company currently insanely overvalued by pretty much all metrics and the recent strength has nothing to do with fundamentals, it’s just a movement into the ticker because they aren’t spending. There’s really no upward catalyst in the near-term. Would never buy puts on something so strong but you have to be crazy to think this is a good time to jump in.