Tesla's (TSLA, Financial) option contracts have become the most actively traded among individual stock options. The $350 and $400 strike options expiring soon have seen the highest trading volumes. Market activity is heavily centered on the $400 call options, as noted by Steve Sosnick, chief strategist at a leading brokerage firm.
According to Trade Alert data, Tesla option contracts recorded over 2.5 million trades in a single day, more than double the usual daily volume, with contracts expiring soon accounting for about 56% of total trades. Tesla's stock price recently surged 9% to $350.
The rise is partially attributed to investor expectations that CEO Elon Musk's potential close ties with the incoming U.S. President might benefit the company. The influx of bullish call options could further drive the stock price up since option brokers may need to purchase more shares to hedge their positions.
Since the election day, Tesla's stock has jumped 39% over just four trading days, indicating strong investor confidence.
