Option update: XMSR & SIRI call volume & volatility up into FCC decision

Posted Nov 6th 2007 3:05PM by Paul Foster
Filed under: XM Satellite Radio (XMSR), Sirius Satellite Radio (SIRI), Options

XM Satellite Radio(NASDAQ:XMSR) is recently up $1.01 to $14.30. XMSR & SIRI announced on 2/20/07 a merger of equals. XMSR shareholders will receive 4.6 SIRI shares for each XMSR share. The Federal Communications Commission (FCC) sent detailed questionnaires to XMSR and SIRI on Nov. 5. The FCC is expected to decide on the merger before year end. XMSR-SIRI arbitrage premium spread is at 14.7%. XMSR call option volume of 40,889 contracts compares to put volume of 13,973 contracts. XMSR December option implied volatility of 94 is above its 26-week average of 59 according to Track Data, suggesting larger price risks.

Sirius Satellite Radio(NASDAQ:SIRI)is recently up 6c to $3.41. SIRI call option volume of 84,578 contracts compares to put volume of 1,145 contracts. SIRI December option implied volatility of 88 is above its 26-week average of 57 according to Track Data, suggesting larger price risks.

Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Tags: arbitrage premium spread, ArbitragePremiumSpread, FCC, merger of equals, SIRI, The Federal Communications Commission (FCC), XMSR