Mike Khouw Sees Unusual Options Activity In Slack

On CNBC's "Options Action," Mike Khouw spoke about unusually high options activity in Slack Technologies Inc WORK ahead of earnings, scheduled on Thursday. He said calls out-traded puts by about 5 to 1 for the last 20 days on average and the options market is implying a move of 12% on earnings in either direction.

Khouw noticed during the session on Wednesday that somebody sold 7,000 contracts of the January 2022, $45 strike calls for $8.87 and bought 406,000 shares of Slack. The trade is going to make the most money if the stock goes up to the $45 strike at the January 2022 expiration, explained Khouw. He added that it will also make money if it drifts higher and volatility comes in.