DraftKings Inc. (NASDAQ:DKNG) experienced a 7.6% surge in its stock price, reaching $26.67, following the announcement of robust growth in its prediction markets for May. Annualized consumer trading volume on its nationwide platform increased by 24% to $1.3 billion, while total volume climbed 34% to $3.1 billion. This update indicates a growing adoption of DraftKings' prediction markets platform.
The significant stock movement was accompanied by an unusually high volume of call options trading. Traders bought 126,727 call options on DraftKings, representing an approximate increase of 210% compared to the average daily volume of 40,842 call options. Specifically, the weekly 6/12 $27-strike call was the most actively traded contract, with new positions being opened.
Options for DKNG appear attractively priced, with the stock's Schaeffer's Volatility Index (SVI) at 57%, placing it in the 29th percentile of its annual range, suggesting relatively low implied volatility. Furthermore, its Schaeffer's Volatility Scorecard (SVS) of 85 out of 100 indicates that the stock has consistently outperformed options traders' volatility expectations over the past year. Short interest in DraftKings also increased by 7.6% over the last two reporting periods to 38.8 million shares, accounting for 8.1% of the available float.
