Election anticipation fuels options activity in solar stocks
Traders are showing significant interest in several stocks through options contracts as the US election nears, according to data from SpotGamma. A common strategy involves purchasing call options with a strike price of 50 for December expiry, anticipating a 17% increase in value. Other favored options include those with strike prices of 46 and 47 for nearer expiry dates.
SolarEdge Technologies is experiencing unusually high trading volume, with call options accounting for over 75% of the activity. The company’s stock price rose more than 6% on Tuesday, ahead of its earnings report scheduled for Wednesday morning. The most prevalent trade involves buying the 35-strike call option expiring this Friday.
Enphase Energy is also attracting bullish attention. The stock rebounded strongly on Tuesday, gaining 9% after a 20% drop following last week’s earnings announcement. Options activity was double the average, with approximately 8,600 calls purchased compared to fewer than 900 puts. A popular trade involves buying the 35-strike call option expiring in January, costing $2.45 per contract and requiring a 23% stock price increase to break even.
“I would only like solar if blue was in the White House,” stated Charlie Moon, of Chicago-based Prosper Trading Academy. He also noted that Enphase Energy is notable due to recent insider buying.
Source
“Options traders are betting heavily on these stocks ahead of election results”
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