HPQ Home Run Call Buyer Strikes Out
- We profiled a “home run” call buyer in HPQ yesterday on The Options Insider (read the full article here https://theoptionsinsider.com/hpq-home-run-calls-trade/)
- That customer purchased 14,000 Sep 16 Calls for $.10 in one block on the PHLX.
- Total volume on the strike was over 26,000 contracts. The customer was clearly wagering on an aggressive post-earnings rally in HPQ.
- Unfortunately for the customer, a post-earnings selloff in HPQ erased 90% of the value of his position. Those same calls are now only bid $.01, reflecting a $126,00 loss on the initial block purchase and a $234,000 loss on total strike volume.
- There is still substantial open interest on the strike – so the customer clearly hasn’t given up on the position. But the outlook for this trade has dimmed substantially in just 24 hours.