As of today Wednesday October 7, 2009 the top ten most active stock option contracts were:

  1. Financial Select Sector SPDR (NYSE:XLF) October 15 Call Option
  2. Citigroup (NYSE:C) October 5 Call Option
  3. S&P 500 SPDR (NYSE:SPY) October 105 Put Option
  4. iShares MSCI Emerging Markets Index Fund (NYSE:EEM) March 36 Put Option
  5. iShares MSCI Emerging Markets Index Fund January 36 Put Option
  6. S&P 500 December Index (SPX) 1050 Put Option
  7. S&P 500 November Index 1050 Put Option
  8. S&P 500 October Index 1050 Put Option
  9. S&P 500 SPDR October 105 Call Option
  10. S&P 500 SPDR October 104 Put Option

It is not everyday where index options trade among the most actives. Judging by today’s activity we can see that one strategist may be very bearish and perhaps because of earnings season approaching. However Alcoa (NYSE:AA) released numbers that trumped expectations and spiked sharply after hours, which is currently causing the DOW futures to be higher by almost 90 points. I assume we may see Alcoa come down to earth tomorrow, but perhaps it could keep on going. I opened up a large position for the October 12.50/14.00 vertical spread for roughly $96 per option contract. Assuming Alcoa expires next Friday above 14 a share (current bid is 14.99) this will return over 50% on my position. Considering I would take the shares of Alcoa at 12.50, this was not as risky of a bet as some may label it… I also purchased several 25 strike October call options on my new favorite breakout: Sykes Enterprises Inc (NASDAQ:SYKE).