Cisco (CSCO) is rallying 70 cents to $16.28 and is the second best gainer in the Dow Jones Industrial Average (behind DIS) today. Meanwhile, options volume on the networking giant includes 171,000 calls and 73,000 puts. The top trade is 18,400 Jan13 $20 calls sold at $1.41 per share against 771K shares at $16.45 and possibly a closing trade. The next biggest is 10,000-contract block of Jan 17.5 calls at 88 cents on ISE and a customer sell-to-close trade, according to ISEE data. A separate block of Jan 19 calls at 42 cents was sold-to-open and possibly tied to stock. An Oct 14 – 17 bullish risk-reversal was bought on CSCO at 19 cents, 6000X on CBOE and is possibly closing and tied to stock as well. Meanwhile, implied volatility in the options on CSCO has eased about 8.5 percent ato 40 and now well below the highs of 67.5 seen two months ago — when the stock was falling to new 52-week lows of $13.3.

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume

Implied volatility in RIM options is elevated today after the UK Independent published an article suggesting Vodafone “could be eyeing the Blackberry manufacturer”. RIMM is rallying for a $2.88 gain to $23.88. Options volume on the stock through midday is 126K calls/66K puts. Nov 20 calls seeing the most volume, with 11,840 traded. Meanwhile, implied volatility in the options on the stock is up 16 pecent to 94 and within striking distance of the 52-week high of 97 set on 9/14.

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume

Williams Companies (WMB) is flat at $23.61 and one strategist pays 38.5 cents for Oct 26 calls, 14000X and sells 20,000 Nov 24 calls at $2.04. Similar action surfaced in the natural gas producer yesterday and open interest updates indicate rolling out from Oct 26 calls to the Nov 24s. If so, it probably exits positions opened last month when Oct 26 calls on WMB were being sold-to-open — including 15500 at $2.25 per contract (see 9/7 color). Shares are down 10.9 percent since that time and today’s call writer is possibly looking for the stock to hold below $24 through the November expiration. Natural gas prices have been in a bearish trend in recent months — down 26 percent since May (from $4.89 to $3.61).

Yahoo (YHOO) adds 27 cents to $14.73 on reports the company’s bankers will be sending out financial info to private equity firms and other bidders in coming days (WSJ, CNBC). Early options trades on the Internet giant include a Jan 12.5 – 15 bullish risk-reversal bought at 95 cents, 6300X. It’s possibly a closing trade. Separately, an investor sold 6500 Jan 15 calls at $1.88 and 10,000 Jan 16 calls at $1.46 — which are possibly closing transactions as well. Implied volatiity in Yahoo options is down about 9 percent to 72.