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Transocean Ltd. (RIG)

NYSE - NYSE Delayed Price. Currency in USD
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2.7800-0.0200 (-0.71%)
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  • Benzinga

    Understanding Transocean's Unusual Options Activity

    On Tuesday, shares of Transocean (NYSE:RIG) saw unusual options activity. After the option alert, the stock price moved up to $2.96. * Sentiment: BULLISH * Option Type: TRADE * Trade Type: CALL * Expiration Date: 2021-05-21 * Strike Price: $1.50 * Volume: 200 * Open Interest: 1383Three Ways Options Activity Is 'Unusual'Exceptionally large volume (compared to historical averages) is one reason for which options market activity can be considered unusual. The volume of options activity refers to the number of contracts traded over a given time period. The number of unsettled contracts that have been traded, but not yet closed, is called open interest. These contracts are not yet closed because a buyer has not purchased the contract, or a seller has not sold it.Another indicator of unusual options activity is the trading of a contract with an expiration date in the distant future. Additional time until a contract expires generally increases the potential for it to grow its time value and reach its strike price. It is important to consider time value because it represents the difference between the strike price and the value of the underlying asset.Contracts with a strike price far from the underlying price are also considered unusual because they are defined as being "out of the money". This occurs when the underlying price is under the strike price on a call option, or above the strike price on a put option. These trades are made because the underlying asset value is expected to change dramatically in the future, and the buyer or seller can take advantage of a greater profit margin.Understanding Sentiment Options are "bullish" when a call is purchased at/near ask price or a put is sold at/near bid price. Options are "bearish" when a call is sold at/near bid price or a put is bought at/near ask price.These observations are made without knowing the investor's true intent by purchasing these options contracts. The activity is suggestive of these strategies, but an observer cannot be sure if a bettor is playing the contract outright or if the options bettor is hedging a large underlying position in common stock. For the latter case, bullish options activity may be less meaningful than the exposure a large investor has on their short position in common stock.Using These Options Strategies Unusual options activity is an advantageous strategy that may greatly reward an investor if they are highly skilled, but for the less experienced trader, it should remain as another tool to make an educated investment decision while taking other observations into account.For more information to understand options alerts, visit https://pro.benzinga.help/en/articles/1769505-how-do-i-understand-options-alertsSee more from Benzinga * Click here for options trades from Benzinga * Unusual Options Activity Insight: FuelCell Energy * Analyzing Energy Transfer's Unusual Options Activity(C) 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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  • Are Options Traders Betting on a Big Move in Transocean (RIG) Stock?

    Are Options Traders Betting on a Big Move in Transocean (RIG) Stock?

    Investors need to pay close attention to Transocean (RIG) stock based on the movements in the options market lately.