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Why are Options Bullish on This Smartphone Maker?
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Managing Editor, OptionMonster
Nokia attracted upside options activity yesterday after industry figures showed that its smartphones are gaining international market share.
The bullish trading was focused on the December 14 contracts, where 5,688 calls changed hands in a strong buying pattern above open interest of 3,638. That dwarfed the average volume of just 267 calls per day for the last month, according to OptionMonster's proprietary tracking systems.
Nokia [NOK
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] rose 2.73 percent yesterday to close at $13.57. The handset maker has been trading mostly between $12 and $16 since the start of April, including an 11 percent gap lower on Oct. 15 after reporting a loss in earnings.
The largest blocks of December 14 calls were bought for $0.51 yesterday. For those contracts to profit, Nokia's stock would need to rise roughly 7 percent or more before the options expire on Dec. 17.
The buying took place after industry researcher IDC reported that Nokia's global market share in smartphones grew in the third quarter from the same period last year. Although headlines have focused on competing handsets from Apple [AAPL
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], Palm [PALM
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], Research In Motion [RIMM
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], and most recently Motorola [MOT
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], IDC said Nokia maintains a commanding 37.9 percent of the market.
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Options Trading School:
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Mike Yamamoto is an analyst and writer for OptionMonster.
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Data is a real-time snapshot *Data is delayed at least 15 minutes