Option update: E*Trade options suggests continued risk

E*Trade (NASDAQ: ETFC) is recently trading down $4.70 to $3.89. ETFC announced it expects to take significant write-downs in Q4 on its asset-backed securities. ETFC announced The Securities and Exchange Commission is conducting an informal inquiry of ETFC loan and securities portfolios. Mitch Caplan has been the CEO and a director of ETFC since January of 2003. ETFC Capital Markets President Dennis Webb has left the company. Goldman Sachs says "we see no near-term relief from the continued downturn in value of its asset-backed portfolio." ETFC call option volume of 51,316 contracts compares to put volume of 22,474 contracts. ETFC January option implied volatility of 171 is above its 26-week average of 53, according to Track Data, suggesting larger price fluctuations.

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