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Sharp move seen in GT Advanced

Chris McKhann (chris.mckhann@optionmonster.com)

GT Advanced Technologies hit a seven-month low yesterday, and a huge trade is betting on a big move up or down by the end of the year.

Just shy of 30,000 of the December 11 puts changed hands, compared to the previous open interest of 1,667. The puts were bought in two blocks of 12,500 for $1.35 and $1.40.

Seconds after, 850,000 shares of GTAT were bought for $12 even. The delta of the stock balanced that of the options, creating a directionally neutral strategy that is looking for a big move higher or lower and/or for volatility to be greater than that implied by the option price. (See our Education section)

GTAT was just shy of $19 two weeks ago but yesterday fell 7.33 percent to $11.88, its lowest close since mid-February. The stock fell sharply last week after Apple disclosed that the iPhone 6 would not include sapphire glass produced with GT Advanced's furnaces, though it will be used in the new Apple Watch.


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