Weekend Options Review: Citi’s Explosive Options (C)

Posted in Options 
November 6th, 2010

Taking a step back and reviewing options trading patterns on the weekends can bring some attention that is not usually seen during each tick of the trading day.  Citigroup, Inc. (NYSE: C) may still be a stock which could double from earlier prices, but the options trading was through the roof on Friday.  It looks like more than 1 million contracts traded hands on Friday in the CALLS throughout various months and various strikes.  Even for a highly-active stock with a low price like Citi, having 1 million options contracts trade is not normal.  That is more than 100 million shares worth of options-equivalent trading on a fully leveraged basis.

Here was the call option highlight:

  • 113,084 of the NOV10 $4.50 CALLS
  • 227,910 of the DEC10 $4.00 CALLS
  • 106,654 of the DEC10 $4.50 CALLS
  • 72,066 of the DEC10 $5.00 CALLS
  • 106,168 of the JAN11 $4.00 CALLS
  • 155,352 of the JAN11 $4.50 CALLS
  • 106,405 of the JAN11 $5.00 CALLS

Citi is far from being among the first to be able to reinstate a dividend. Obviously no one is calling for any buyout or anything like that.  Citi is a bank that is going to get smaller as it narrows its focus down to a Core-Citi-Structure as it continues to break up its old financial super-market business model.

Citigroup’s common stock closed up by 3.7% at $4.49 Friday, and the volume in the shares was also the roof… over 1 billion served.

JON C. OGG

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