Apple Inc. (NASDAQ:AAPL) stock continued to climb to record highs in the market at the back of increased positive sentiments from Wall Street especially from activist investor Carl Icahn of Icahn Capital Lp. As the company’s prospects continue to look brighter so are the number of calls increasing in the Options market according to CNBC’s, Michael Khouw.
The average call volume has been on the increase in the recent past as optimism about Apple Inc. (NASDAQ:AAPL)’s sales continue to increase especially in the current iPhone product cycle, as well as the upcoming products. Apple market value has ballooned this week beyond the $700 billion mark with the next stop being the $1 trillion mark according to Icahn.
“We saw about one and half times the average daily call volume today four of the five most active options were all calls. What I think was really interesting is we get some sense of what the pace of the increase in Apple Inc. (NASDAQ:AAPL) share might be,” said Mr. Khouw.
Thursday trading session saw the sale of May 135 calls for $3.50 as investors remain confident that the stock could soar to $1.35 a share by May, which is consistent with the Apple’s long-term trend. With this trade according to Khouw, the profits zone is going to be between 3% down and 10% up, which is consistent with the pace that is expected over the course of the next 90 days.
The increase in activity in the Options calls trade could be accelerated in the coming days after activist investor Carl Icahn raised his share price target to $216 from 203. Bullish sentiments are also poised to remain strong in the wake of CEO, Tim Cook, drumming up support for Apple Watch that is to be released in April. While reiterating that iPhone 6 sales and Mac computer sales remained strong
Icahn insists investors were undervaluing Apple Inc. (NASDAQ:AAPL) with a call for more share buybacks as one of the ways of unlocking value.
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