Unusual Options Trading Action In Regions Financial (RF)

Banking, finance, and taxes

Published: March 20, 2012 2:15 pm

Last Updated: April 28, 2020 8:57 am

Regions Financial Corporation (NYSE: RF) is usually no longer very active when it comes to stock options trading. So what happens when it makes the screen of highly unusual trading volume in speculative call options. The unusual activity is taking place in the $7 and $8 MAY CALL options rather than in the front-month of April. The $7 call options in May have seen 5,228 contracts trade against an open interest of 5,716 contracts. The real activity is out in the $8 calls where a whopping 15,547 contracts have traded today against a prior open interest of 2,498 contracts.

So far today there has not been any corresponding put option activity so this is unlikely going to be viewed as hedging.

Regions shares are up 1.2% at $6.43 on more than 32 million shares as of 2:07 PM EST. The 52-week range is $2.82 to $7.45 and the average daily volume is about 23 million shares.

It sure looks like someone is thinking that there is a lot of room left to run in Regions. Even if that $8.00 strike price does not get hit, those May $8 calls will offer a lot of leveraged return if the shares make another considerable move higher in a short period of time.

JON C. OGG

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