As earnings season slows, activity in the

options market is following suit. The

Chicago Board Options Exchange

volatility index, or the VIX, for instance, remains relatively flat, moving up 0.20, or 0.71%, to 28.39 in recent trading.

But one options specialist points out that volatility has come down significantly over the past six weeks. In fact, back on March 22, the VIX reached an intraday high of 41.99. And as volatilities fall, the specialist says, investors will see stability increase in the market. Implied volatility reflects how much a stock is expected to move over the life of an option. The volatility of a stock will increase during periods of uncertainty such as earnings season or chatter about a possible merger.

That being said, much of the activity on the major exchanges today appeared to be either a result of a large institutional trade or an individual investor rolling the dice on a particular option whose strike price is a far cry from the share price. A case in point was online auction service


, which was seeing high options volume. priceline, famous for its TV ads featuring the musical stylings of

William Shatner

, was up more than 35% at the close today after

Goldman Sachs

raised its rating on the e-commerce outfit. A few investors placed extremely bullish bets on the

out-of-the-money May 17 1/2 calls, which traded over 4,500 contracts on open interest of 1,031.

Considering the stock is currently trading at about $6, buying the 17 1/2 calls seems like a pretty risky bet, if not a downright foolish one. When you buy out-of-the-money options, there isn't much time for them to materialize. And some traders warn against buying options on stocks below $5 because there is always the chance the stocks may be delisted following a downtrend in the market. However, the premium on the 17 1/2 calls is listed at just 85 cents, making them a cheap play. So basically, the investor is willing to bet that the stock will go up a lot, but if it doesn't, the investor is only out what he or she paid for the premium.

Although it's clear that the Goldman research note is driving the share price up, is it enough to justify staking a claim in options that are so far out of the money? Probably not. But that's the beauty of options. An investor can afford to make such a risky bet because the premium on the May 17 1/2 calls are so low. A case could be made that investors are betting on a possible takeover of the company, but odds are it's just a case of some investors taking a shot in the dark.

It's sort of like buying a lottery ticket -- the cost of the ticket is a drop in the bucket, but if you guess correctly, you could win millions.