Today some institution/fund purchased 60,253 contracts of January 2020 $22.50 strike calls (or the right to buy 6,025,300 shares of Teva Pharmaceutical Industries Limited (TEVA) at $22.50).  The open interest was just 15,762 prior to this purchase. There as another block of ~40,000 contracts done at the $17.50 strike (same month 8 minutes later).
Monitoring unusual options activity can be a useful tool. Large amounts of options being traded on a particular stock may provide some valuable insight into what the “smart money†is doing.
Checking unusual options activity on a regular basis can draw attention to stocks that would have otherwise been missed and can prompt traders to analyze why options volume has spiked for a certain equity. For example, a large option order could be done for a number of different reasons, sometimes they can even look deceptive. For the most part, options can be used to hedge an existing position or for speculation. Our job is to look at the underlying security and figure out why – before taking any action.
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