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Schaeffer's Options Update: Dell Swarmed with Calls Following H-P's Earnings

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  Published in Science and Technology on Thursday, February 19th 2009 at 13:00 GMT, Last Modified on 2009-02-19 13:00:43 by Market Wire
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CINCINNATI--([ BUSINESS WIRE ])--What's bad for Hewlett-Packard (NYSE: HPQ) must be good news for rival computer manufacturer Dell (NYSE: DELL). At least, that's where options traders are placing their bets. More than 11,000 bullishly oriented calls have traded on Dell so far today, more than doubling the stock's average daily call volume. At last check, these optimists appear to be on the wrong side of the trade, as Dell shares have dropped more than 6% following H-P's poorly received earnings report.

This swell in the popularity of Dell calls has placed the equity on today's Intraday Volume Explosion List. What's more, today's activity falls in line with options traders' ravenous appetite for call options. Specifically, the International Securities Exchange and Chicago Board Options Exchange's 10-day call/put volume ratio of 3.46 indicates that calls bought to open have more than tripled puts bought to open during the prior 2 weeks. Furthermore, this ratio arrives at an annual high, meaning that options traders have not been on a bigger call buying spree during the past year.

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