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Nothing Standard About Standard Products Options Trading

Volume spiked this week the day before a big move.

Suspicious minds and conspiracy theorists would revel in Wednesday's options market: spotty trading, a confused broader stock market and unusually heavy interest in some companies whose names once heard are -- like a word just learned -- oft repeated.

Take

Standard Products

(SPD)

, which has seen "voluminous call-buying," according to Larry McMillan of

McMillan Analysis

, and higher-than-normal implied volatility.

Standard Products pretty much lives up to its name, manufacturing rubber and plastic auto and appliance parts. It's about as far as an investor can get from a sexy Internet story like those recently dominating the options-trading landscape.

That hasn't stopped activity in its options, which on Tuesday and Wednesday pierced what had been an uneventful trading surface. By Wednesday traders were "seeing some very suspicious buying," according to the

Pacific Stock Exchange

pit rep in Standard Products options.

"All of a sudden, we've seen nothing but call buyers in two or three strikes," the trader said. "It's all one-way orders, one or two customers on the retail side. We keep looking for news, but there's been nothing."

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Options volume on Tuesday punched through the 5,000-contract level, about quadrupling the average daily volume on Standard. Call buyers went for the July 25 calls Tuesday and were looking pretty intelligent by midday Wednesday, when the stock was up more than 2 to 27 1/8.

While volume Wednesday was slight, the July 25 premium spiked 1 1/16 ($106.25) to 3 5/8 ($362.50), a tidy one-day gain.

Meanwhile, the pit rep said, floor traders continued bidding Standard Products' stock price higher as they bought stock to hedge the short positions created by their fulfilling public buying demand for the calls.

A call to the company's chief financial officer wasn't immediately returned.

Now, a note from the Did Someone Knew Something? department.

A big trade in

Ford

(F) - Get Ford Motor Company Report

puts early Wednesday morning preceded news that the auto giant's credit arm wouldn't go forward with a $3 billion bond offering due to poor market conditions. The paper was designed to be a corporate bond-market benchmark.

Roughly 3,000 contracts of 2001 January 55 puts crossed at 9:43 a.m. on the

Chicago Board Options Exchange

against open interest of 1,609. The puts gained 5/8 ($62.50) to 8 ($800). Ford's stock, meanwhile, was down 13/16 to 54.