IBM options were thrown into chaos Tuesday after the stock plunged roughly 25% on disappointing preliminary results, crushing bullish bets and rewarding traders positioned for a sharp drop. IBM reported preliminary revenue of $17.2 billion, well below Wall Street expectations, sending shares into the $217 to $222 range. The $300 calls, which carried 8,580 contracts of open interest, collapsed more than 99% to a one-cent bid, while the $220 calls fell 89% to $7.75 and the $230 calls dropped 94% to $3.60. On the other side, $230 puts surged 115,800% to $11.59, and $275 puts jumped more than 4,300% to $52.60.
International Business MachinesIBM reported preliminary revenue of $17.2 billion, well below Wall Street expectations, causing a 25% stock plunge.