More than 3 million MSTR calls and 2 million puts have been traded over the last 2 weeks
Software stock MicroStrategy Inc (NASDAQ:MSTR) has spent recent weeks consolidating around the $320 region, holding its +10% year-to-date level since the start of the year. The company has been in the spotlight as it buys up more Bitcoin (BTC), even recently cutting 20% of its workforce in order to do so.
MSTR has been popular amongst options traders. In fact, the stock made its way onto Schaeffer's Senior Quantitative Analyst Rocky White's list of stocks with the highest options volume over the past 10 days. During this period, 3,486,312 puts and 2,150,898 puts were exchanged, with the most activity at the weekly 2/14 340-strike call. In fact, nine out of 10 of the top contracts over the past two weeks were calls.
This bullish-leaning sentiment aligns with MSTR's 50-day call/put volume ratio of 3.01 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio ranks in the 99th percentile of its annual range, showing a strong preference for calls over the last 10 weeks.
There remains massive short squeeze potential around the stock. Short interest tapered off in the most recent reporting period, yet the 24.01 million shares sold short account for 10% of MSTR's total available float.
These options are reasonably priced at the moment, too. The equity's Schaeffer's Volatility Index (SVI) of 74% ranks in the 7th percentile of its annual range, meaning options traders are pricing in low volatility expectations.