A large option trade is apparently expecting Activision Blizzard's stock to remain trapped in its recent range.
ATVI is up fractionally at $12.16 in afternoon trading. The videogame company hit a 52-week high in November leading up to the release of its much-anticipated "Call of Duty: Modern Warfare 3" title, but shares then fell and have been drifting sideways for two months between $11.60 and $12.60.
Today's option volume has exceeded 12,000 contracts, nearly 5 times the daily average. Most of this is in the March 11 puts, which saw 10,000 contracts sold for the bid price of $0.16, according to optionMONSTER's systems.
This put seller sees the stock holding above $11 through the March expiration but doesn't anticipate significant upside either, or the trader would just buy the stock. Instead, he or she is betting that ATVI's actual volatility will be less than 32 percent implied volatility of those options. The 30-day historical volatility is down at 22 percent. (See our Education section)
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