MA - Mastercard Inc. – A GAO report concluded that lowering processing fees charge by card payment processors charged at stores might not save consumers money, who might also end up paying more for purchases. As we stare at a sea of red on our market scanners today, options activity at two companies stands out to display healthy call activity. Meanwhile both share prices have jumped higher as investors respond to the lower likelihood of reduced profits at Mastercard, whose shares are 3% higher at $234.15. Option traders proved just how treacherous such movements in the underlying can be in the context of soon-to-expire options. For example the premium on put options expiring at the weekend with a 230 strike price dropped from 7.0 to just 65 cents as investors exchanged more than 5,000 contracts. On the other side of the coin investors drove up the call premium at the 230 strike from 50 cents to 6.00. In perhaps bolder bets, the 240 strike calls rose from 15 cents to 85 cents at one point on volume of almost 5,000 lots.

V - Visa Inc. – The relief from the same GAO report allowed shares in Visa to rise just 1% to $81.10 but not before shares traded at a 10-day low earlier in the session. But that's where the fun started with options on the card-processor. November calls at the 80 strike traded 2,600 times at a 46 cent premium before a spike in the share price sent premiums surging to as high as 1.16. At that point it looks like early call buyers banked handsome gains. As premiums eased to 90 cents we show two 10,000 lot blocks trading. Further share price gains propelled the same premium to as high as 1.84. Implied volatility gained around 12% this morning as traders responded to the news.

" title="RF : Stock Quote, News and Research" class="showrtquote">RF - Regions Financial Corp. – Near-term investors displayed bearish sentiment on Regions Financial today, while longer-term traders took to the February 2010 contract to establish bullish positions. The banking company's shares are currently lower by 0.5% to $5.36. Investors purchased at least 2,300 puts at the December 4.0 strike for an average premium of 4 cents per contract. Perhaps put-buyers are scooping up cheap downside protection in case shares of RF collapse 25% by expiration next month. The same strike price was targeted in the February 2010 contract, but investors here utilized puts to get bullish.