Calls Active as Dell Pushes to New Lows (DELL)

Shares of Dell Inc. (DELL) are trading higher on the session by 0.31%, at $9.46. The stock hit a fresh 52-week low of $9.35 during yesterday’s trading and tested the level early this morning.

It appears that some swing traders are dipping their foot in the water here; one options trader is doing the same. Just after the opening bell, 4,887 November $10 calls were purchased, on the offer, for $0.20-0.22. Volume has since risen to over 5,100 contracts; open interest is 4,587.  

Given Dell’s current implied and historical volatility, 29% and 23% respectively, the trader paid a bit of a premium for the contacts at 33% vol.

What is interesting here is that this does not appear to be a play on earnings, as the Nov contract expires just days before Dell is scheduled to report Q3 earnings (November 20^th). The Street is looking for $0.40 per share on revenues of $13.95 billion.

Dell Inc. is a global information technology company that offers its customers a range of solutions and services delivered directly by Dell and through other distribution channels. 

About Michael Zerinskas

Originally from Chicago, Michael J. Zerinskas began his career as an intern for a small high-frequency trading firm based at the CME; he then moved on to become Chief Options Strategist at Benzinga.com. Michael is now Unusual Activity Editor at The Options Insider, specializing in VIX, volatility, and flagging unusual activity.