Note: The Daily Option Update is provided by Stock Options Specialist Paul Foster of theflyonthewall.com.
Volatility Index S&P 500 Options-VIX up .63 to 11.07.
New Century Financial Corp. (NYSE:NEW) implied volatility & put volume Aggressive on Subprime risk
New Century Financial is a real estate investment trust, providing mortgage products to borrowers nationwide, is recently down $1.95 to $17.29. New Century Financial sold off 35% yesterday after announcing it would restate operating results for the first three quarters of 2006. Roth Capital says, "we have no reasonable basis on which to calculate estimates of GAAP earnings, taxable income, dividends or fair value. We are, therefore, suspending our estimates, price target and rating."
New Century Financial call option volume of 16,187 contracts compares to put volume of 41,414 contracts. NEW March option implied volatility of 92 is above a level 69 from yesterday and its 26-week average of 43 according to Track Data, suggesting aggressive price fluctuations.
MasterCard Inc. (NYSE:MA) option prices swinging on Heavy volume as MA off 12.5% on Valuation
MasterCard, a global payment solutions company, is down $14.18 to $100.50. Cowen says "as indicated by MasterCard's strong results, the company continues to benefit from ongoing reductions in SG&A expenses." Cowen goes on to say, "we attribute this morning's 10% sell-off in the stock to management's reluctance to commit to more aggressive reductions in SG&A expense throughout 2007." Goldman Sachs says, "valuation still represents a significant headwind for us to get more bullish on the stock."
MasterCard call option volume of 80,332 contracts compares to put volume of 60,254 contracts. MA March option implied volatility of 37 is near its 26-week average of 38 according to Track Data, indicating non-directional price fluctuations in next six weeks.
Option volume leaders today were: Broadcom Corp. (NASDAQ:BRCM), MasterCard Inc. (NYSE: MA) and Apple Inc. (NASDAQ: AAPL).
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