One tech stock that has stood its ground amid the carnage of recent weeks has been

Sun Microsystems

(SUNW) - Get Report

. The computer juggernaut's options action continued to reflect bullish sentiment on Thursday.

Investors this week have shown an appetite for buying Sun call options, which give an investor the right, though not the obligation, to buy the stock at a certain price by a given date. The company is set to report quarterly earnings Oct. 18. With shares of Sun up $2.81 to $120.75 at midday, the call buying showed that investors expect Sun to continue to outperform the sinking

Nasdaq Composite Index


Dan Brady of


, the lead market maker for Sun options at the

Pacific Exchange

, said there have been a lot of call buyers for Sun October options this week. Brady also pointed out that the implied volatility for Sun options, which measures the expected move (either up or down) in the underlying stock, has increased lately. He said he expects that the implied volatility on Sun options will probably go a little higher over the near term.

Volume in Sun options was heaviest in the October 115 calls, where nearly 2,400 contracts changed hands at the P-Coast. The in-the-money October 115 calls were up 1 3/4 ($175) to 10 ($1,000). Interest was also being seen in the October 120 calls, where 1,208 contracts changed hands at the

Chicago Board Options Exchange

. The calls were up 1 1/2 ($150) to 6 7/8 ($687.50).


Securities and Exchange Commission

this week cleared plans by the

Pacific Exchange

and the

Philadelphia Stock Exchange

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to join a linked options market. In July, the agency

approved the linkage of the three other options exchanges,

Chicago Board Options Exchange

, the

American Stock Exchange

and the

International Securities Exchange

. The SEC had rebuffed linkage plans proposed by the P-Coast and PHLX.

The SEC's temporary thumbs-up lasts until Jan. 18. The P-Coast and PHLX recently submitted their proposals to participate in the linkage, and the SEC gave them the temporary approval so they could begin to participate in talks on how the linkage will form. The P-Coast and PHLX plans are currently under a comment period.

Since the advent of multiple listings of options in 1999, the market has been fragmented, with many options trading on as many as five different exchanges, frequently at different prices. Because of this, investors' options orders sometimes don't get filled at the best price. For example, the quote for the lowest offer for an option could be different at three exchanges, and an investor might end up paying more for the option if the order isn't routed to the exchange with the best price.

The SEC has noted that because of multiple listing, along with a lack of effective access across the options exchanges, the chances of an intermarket trade-through -- the order being executed at a worse price than is available on another market -- are "significantly increased." Intermarket trade-throughs are estimated to happen in as many as 5% of all options trades.

The P-Coast and PHLX plans that were originally rejected would have mandated that even if an exchange receiving an order is quoting at the national best bid-offer, or NBBO, the order wouldn't trade at that exchange unless it were the exchange that first displayed the best price. (NBBO refers to the highest bid quoted to buy an option among the five options exchanges, and for best offer it refers to the lowest price quoted to sell an option.) The NBBO order would then have to be routed to the exchange that had the best price first.

The linkage plan by the CBOE, Amex and ISE, which was given the nod by the SEC, will allow an exchange receiving an options order to match a better price displayed at another exchange.

In the latest

move by an online broker to lower commissions for options trading,


(AMTD) - Get Report

announced Thursday it is lowering options commission fees for Internet market orders to $8 from $25, plus $1.75 per contract, effective this coming Tuesday. The $1.75-a-contract charge remains the same. The new commission schedule will be available to all new and existing customers, Ameritrade said.

In a story in


predicted the likelihood that online options trading commissions would fall.