Activision Blizzard has held up better than most stocks in the
recent selloff, and today's put buying may be bullish.
optionMONSTER's tracking systems detected the purchase of more than
16,000 August 11 puts for $0.32 against open interest of 5,093
contracts. Shares in the video-game company were purchased at about
the same time and held their ground later in the session despite
the broader market pushing down to new lows.
That suggests that the puts are being used as protection by an
investor who wants to own the stock. At other times, when puts are
bought and shares fall, it suggests a position is being liquidated.
ATVI is off 3.24 percent to $11.06 in afternoon trading and is down
8 percent in the last month. In contrast, the S&P 500, Nasdaq
Composite and Dow Jones Industrial Average have lost more than 10
percent of their value over the same period.
A new strategy for managing its games, with a focus on a smaller
number of high-performing titles, caused earnings and revenue to
beat forecasts by a wide margin the last time ATVI reported
earnings on Aug. 3. Management also raised guidance.
Overall option volume in ATVI is 9 times greater than average, with
calls outnumbering puts by 13 to 1.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.
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