Daily Report — November 12, 2021

Tom Gentile

Posted in Daily Report

By: Tom Gentile on November 12th, 2021 • 2 mins read

Highest Option Volume List

Whenever I look at the Highest Option Volume list I see more options that are LEAPs options than in some of the other lists. I like to trade shorter-term to expiration options, anywhere between a few days to 30-45 days.

What option strategy is being used?

The tools produce the data of the influx of options volume on these securities, but there isn’t a definitive way to assess if these options were bought to open, sold to open or closed.

It could be that these LEAPs are being bought to open for conservative options traders who are buying these options to profit over their longer-term bullish view. They could be buying these LEAPS and then selling to open shorter-term call options against them setting up a Time Spread or Calendar Spread.

Shorter-Term Options

In the cases where the options listed are shorter-term the concern I look out for is if there is an earnings report coming up before the option expiration shown.

Remember, with an option of any expiration I do not typically like to hold the option over an earnings announcement. It has been proven the price reaction to the earnings announcement, whether it was a good or bad report can crush a stock and any bullish option trade could get destroyed along with it.