* Apple stock goes ex-dividend on Thursday
* Shareholders at Wednesday's close eligible for $2.65
* In-the-money call options soar
By Angela Moon
NEW YORK, Aug 8 Options activity on Apple Inc
jumped on Wednesday as investors scrambled for
last-minute strategies to exploit Apple's first quarterly
dividend in 16 years.
Apple shares closed down $1.05 at $619.86 on Wednesday with
volume at 8.66 million, below the 50-day moving average of 14.2
But options volume soared to about 1.34 million - 1.21
million calls and 128,000 puts - significantly exceeding the
daily average of about 600,000 options.
Late last month, Apple, which beats earnings expectations
with near regularity, reported its second quarterly miss in less
than a year, sending shares down 4 percent the next day.
The stock, however, is up 1.7 percent so far in August and
up nearly 1 percent for the week as investors rushed for the
cash dividend. Shareholders as of Wednesday's close will be
eligible for a dividend of $2.65 per share. The stock hit an
all-time high in April of $644.
The in-the-money calls were trading at heavy volume on
"Traders buy those, sell them seconds later and exercise
their right to turn the long call into stock, to trade into a
long stock, short call position, trying to capture that $2.65
dividend," said Jon Najarian, co-founder of optionMonster.com.
"With 937.4 million shares at a $2.65 dividend, that's a
$2.5 billion payout," he said.
The largest positions were in the January $400 strike calls
carrying open interest of about 22,000 contracts and August $600
strike calls, which have open interest of 15,329 contracts,
according to Henry Schwartz, president of options analytics firm
Apple is usually the most active stock in the options market
and has exceeded 1 million contracts per day several times this
year. The previous all-time high was 2.1 million contracts on
March 14, according to options analytics firm Trade Alert.