Following an awkward earnings report shares in social media company Twitter (Ticker: TWTR) have fallen by 12% to $37.56 with the typical post-earnings burst of pumped-up volatility readings. Option volume on Twitter is among the most active at the start of trading with volumes reaching 45,000 within the first 12 minutes.
The first contract to exceed 1,000 contracts was Friday’s weekly expiring put at the 35.0 strike where ahead of yesterday’s close investors had amassed just 6,100 positions. Despite shares in Twitter closing at $42.60 on Tuesday, concerned investors boosted the premium on the 35.0 strike put option to as high as 1.00 last week. So far 3,600 puts at the strike have traded while volume is picking up at the 34 strike as investors consider the potential for further declines ahead of the weekly expiration. Overall implied volatility has fallen by around one-quarter to 62.5% while the puts listed above are trading with volatility readings of around 100%.
Bearish plays outweighed bullish call activity by around 30% in early trading.
Twitter implied volatility tumbles, while nearby weekly expiration remains high.