BloggingStocks

Options Update: iShares MSCI South Korea Index Fund April Volatility Low, July Elevated

Paul Foster — Tue, 29 Mar 2011 09:00:00 EST

Filed under: Apple Inc (AAPL), Netflix, Inc. (NFLX), Citigroup Inc. (C), Options, Kraft Foods'A' (KFT)

iShares MSCI South Korea Index Fund (EWY) April put option implied volatility is at 25, July is at 29; compared to its 26-week average of 27, according to Track Data, suggesting less near-term price movement compared to outer month risk.

CBOE Volatility Index (VIX) closed up 1.53 to 19.44.

Option volume leaders today: Apple (AAPL), Citigroup (C), Netflix (NFLX), Kraft (KFT), according to Track Data.

Update is by Stock Specialist Paul Foster of theflyonthewall.com.

Options Update: iShares MSCI South Korea Index Fund April Volatility Low, July Elevated originally appeared on BloggingStocks on Tue, 29 Mar 2011 09:00:00 EST. Please see our terms for use of feeds.

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Chuck Adds optionsXpress to Schwab's Portfolio

Trefis — Thu, 24 Mar 2011 09:10:00 EST

Filed under: Deals, Bank of America (BAC), Charles Schwab Corp (SCHW), Options, E*TRADE (ETFC)

Charles Schwab (SCHW) has announced its decision to acquire optionsXpress (OXPS) in a friendly all-stock deal. This deal will help Schwab compete with other firms like E-Trade (ETFC), Ameritrade (AMTD), and Bank of America (BAC), which all have large online brokerage services and are vying to provide investors with the best tools and services.

The deal, which is expected to close by the third quarter of 2011, will cost Schwab $1 billion, and the company will issue 60 million new shares to swap each outstanding share of optionsXpress with 1.02 of its own shares. Our $19.74 price estimate for Charles Schwab is at a premium of almost 12% to its current market value.

Continue reading Chuck Adds optionsXpress to Schwab's Portfolio

Chuck Adds optionsXpress to Schwab's Portfolio originally appeared on BloggingStocks on Thu, 24 Mar 2011 09:10:00 EST. Please see our terms for use of feeds.

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Options Update: Berkshire Hathaway Volatility at Low End of Range

Paul Foster — Wed, 26 Jan 2011 09:00:00 EST

Filed under: Berkshire Hathaway (BRK.A), Wendy's Intl (WEN), Options

Berkshire Hathaway (BRK.B) overall option implied volatility of 21 is below its 26-week average of 24, according to Track Data, suggesting decreasing price movement for Warren Buffett's conglomerate.

Wendy's/Arby's (WEN) overall option implied volatility is at 40, below its 26-week average of 47, according to Track Data, suggesting less risk into its investor's day on January 27.

Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.

Options Update: Berkshire Hathaway Volatility at Low End of Range originally appeared on BloggingStocks on Wed, 26 Jan 2011 09:00:00 EST. Please see our terms for use of feeds.

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Options Update: JPMorgan January Call Spreaders Active on Low Volatility

Paul Foster — Fri, 03 Dec 2010 09:00:00 EST

Filed under: JPMorgan Chase (JPM), duPont(E.I.)deNemours (DD), Options

JPMorgan (JPM) January 39 and 41 calls are active on total call volume of 100K contracts, compared to 40K puts. December and January call option implied volatility is at 27, February is at 29, below its 26-week average of 35, according to Track Data. Large call volume suggests spreaders positioning for tighter price movement.

DuPont (DD) is hosting an investor day on Dec. 9. Overall option implied volatility of 25 is near its 26-week average, according to Track Data, suggesting non-directional price movement.

Option volume leaders today: BAC, LVS, AAPL, C, according to Track Data.

Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.

Options Update: JPMorgan January Call Spreaders Active on Low Volatility originally appeared on BloggingStocks on Fri, 03 Dec 2010 09:00:00 EST. Please see our terms for use of feeds.

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Chasing Value: "Home Prices Are About to Bottom"

Sheldon Liber — Mon, 15 Nov 2010 09:00:00 EST

Filed under: Competitive Strategy, Home Depot (HD), Lowe's Cos (LOW), KB HOME (KBH), Lennar Corp'A' (LEN), Toll Brothers (TOL), Duke Energy (DUK), Options, Chasing Value[TM], Housing, Federal Reserve, Recession

"Home Prices Are About to Bottom" was the headline for the Barron's cover story the week of July 14, 2008. The story explained that the housing market should level off in many areas of the country by the end of the year.

I have made some equally unfortunate prognostications in my tenure at BloggingStocks, so my purpose is not to poke fun at Barron's but to point out that here we are, over two years later, and it is still debatable whether the housing market has bottomed out.

Continue reading Chasing Value: "Home Prices Are About to Bottom"

Chasing Value: "Home Prices Are About to Bottom" originally appeared on BloggingStocks on Mon, 15 Nov 2010 09:00:00 EST. Please see our terms for use of feeds.

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Options Update: Intuitive Surgical November Volatility Elevated, Shares Sell Off 5%

Paul Foster — Tue, 28 Sep 2010 09:00:00 EST

Filed under: Options, Intuitive Surgical Inc (ISRG), Transocean Ltd. (RIG)

Intuitive Surgical (ISRG) closed down $15.32 to $290.26 on Monday. Goldman Sachs initiated a sell rating on ISRG. October put option implied volatility is at 38, November and January is at 42, versus its 26-week average of 37, according to Track Data, suggesting larger November price movement.

Transocean (RIG) closed up $2.30 to $62.36. RIG calls are active on 51K calls (30K puts) with concentrated volume in November calls. October call option implied volatility is at 37, November is at 41, January is at 37, versus its 26-week average of 43, according to Track Data, suggesting decreasing price movement.

Update is by Stock Specialist Paul Foster of theflyonthewall.com.

Options Update: Intuitive Surgical November Volatility Elevated, Shares Sell Off 5% originally appeared on BloggingStocks on Tue, 28 Sep 2010 09:00:00 EST. Please see our terms for use of feeds.

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Options Update: Apple Volatility Low, Shares Approach Record High

Paul Foster — Fri, 17 Sep 2010 09:00:00 EST

Filed under: Apple Inc (AAPL), Alcoa Inc (AA), Options

Apple (AAPL) closed up $1.93 to $272.15 on Thursday. More calls than puts traded on total option volume of 359,000 contracts. AAPL October put option implied volatility is at 29, January is at 33, below its six-month average of 36, according to Track Data, suggesting decreasing price movement.

Alcoa (AA) is expected to report Q3 EPS on October 7. October put option implied volatility is at 36, January is at 39, versus its 26-week average of 42, according to Track Data, suggesting decreasing near-term movement into EPS.

Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.

Options Update: Apple Volatility Low, Shares Approach Record High originally appeared on BloggingStocks on Fri, 17 Sep 2010 09:00:00 EST. Please see our terms for use of feeds.

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Options -- A Foolish Bet on BP?

Sheldon Liber — Mon, 28 Jun 2010 14:50:00 EST

Filed under: Market Matters, BP p.l.c. ADS (BP), Options, Oil

Earlier today, I posted Whose Best Interests Are Served If BP Is Pushed into Bankruptcy? where I disclosed having taken a position in BP p.l. c. (BP), and for better or worse my first test will be the market close on July 16, 2010.

Over the past year, I have started reporting on various put options that I have been doing. In today's example, I sold to open BP at a July strike price of $22.50 (a naked put), receiving $0.50 per share.

My break even is $22.00, and the stock opened today at $27.65 with three weeks to go.

Continue reading Options -- A Foolish Bet on BP?

Options -- A Foolish Bet on BP? originally appeared on BloggingStocks on Mon, 28 Jun 2010 14:50:00 EST. Please see our terms for use of feeds.

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More Options Volume in Las Vegas Sands; This Time on the Bull Side

Beth Gaston Moon — Mon, 21 Jun 2010 15:30:00 EST

Filed under: Options, Las Vegas Sands (LVS)

Earlier this morning, Elizabeth Harrow wrote about a call seller in front-month Las Vegas Sands (LVS) options, expressing a moderately bearish outlook. That wasn't all the excitement in the Sands pits today, however, as we also saw call-spread activity in the September series. In contrast to the call selling, this particular trade represented a moderately bullish thesis.

In late-morning action, more than 8,000 calls had changed hands simultaneously on both the September 23 and 27 strikes. Given the open interest levels heading into today's session, it is probable that this volume was initiated to open. It looks as though the 23-strike calls (in-the-money by more than $4) were bought for $6.08 per contract while the 27-strike calls (in-the-money by about 60 cents) were sold for $3.48 each, resulting in a net debit of $2.60 per bull call spread.

Continue reading More Options Volume in Las Vegas Sands; This Time on the Bull Side

More Options Volume in Las Vegas Sands; This Time on the Bull Side originally appeared on BloggingStocks on Mon, 21 Jun 2010 15:30:00 EST. Please see our terms for use of feeds.

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Bulls Buying Calls in Research in Motion

Beth Gaston Moon — Thu, 17 Jun 2010 09:00:00 EST

Filed under: Research in Motion (RIMM), Options

Research in Motion (RIMM) shares closed down Wednesday, under-performing the broader market, which finished near break even. RIMM didn't report any news of its own accord, but investors likely reacted to an ill-received earnings guidance from mobile-phone peer Nokia Corporation (NOK). A large-scale options trader evidently used yesterday's pullback as an opportunity to scoop up some longer-dated call options.

Early yesterday, a block of around 7,000 out-of-the-money January 85 calls hit the tape for $1.45 per contract ($145 apiece), for a total premium of slightly more than $1 million paid. While open interest is already 10,000 at this strike, it appears these calls were bought to open, judging from an increase in implied volatility (and the fact that these options have more than six months until expiration).

Continue reading Bulls Buying Calls in Research in Motion

Bulls Buying Calls in Research in Motion originally appeared on BloggingStocks on Thu, 17 Jun 2010 09:00:00 EST. Please see our terms for use of feeds.

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'Potential Buy' on Intel (INTC): A Put-Selling Strategy

Steven Halpern — Mon, 07 Jun 2010 11:40:00 EST

Filed under: Intel (INTC), Newsletters, Stocks to Buy

Right now you could sell a put option on Intel (INTC) and pocket a bunch of cash," says Karim Rahemtulla. The contributing editor to White Cap Research explains, "There's no time like a down market to enter 'potential' positions in high-quality stocks."

"Thing is, as volatility continues to ramp-up, options premiums increase right along with it. This means when you buy options, you'll pay more. And when you sell options, you'll get more.

Continue reading 'Potential Buy' on Intel (INTC): A Put-Selling Strategy

'Potential Buy' on Intel (INTC): A Put-Selling Strategy originally appeared on BloggingStocks on Mon, 07 Jun 2010 11:40:00 EST. Please see our terms for use of feeds.

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An Intel (INTC) Bull Makes a Big Bet

Beth Gaston Moon — Wed, 02 Jun 2010 15:20:00 EST

Filed under: Intel (INTC), Options

One Intel (INTC) investor placed a sizable bullish bet earlier this morning by selling puts and buying calls to simulate a long stock position using options. Shortly after 11:00 AM, this investor bought roughly 10,000 October 25 calls for 47 cents apiece and simultaneously sold 10,000 October 18 puts for 80 cents apiece, collecting a total of 33 cents per spread. Both the call and the put are out-of-the-money, each by about 16%.

Because this type of spread carries a similar risk profile as Intel long stock (without the required capital needed to buy the shares outright), it is occasionally referred to as a "synthetic long stock." Since the call and put are at different strikes in this trade, the strategy is technically called a "synthetic long stock - split strikes."

Continue reading An Intel (INTC) Bull Makes a Big Bet

An Intel (INTC) Bull Makes a Big Bet originally appeared on BloggingStocks on Wed, 02 Jun 2010 15:20:00 EST. Please see our terms for use of feeds.

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Option Buyers Extend Their AIG Bet

Beth Gaston Moon — Tue, 11 May 2010 15:40:00 EST

Filed under: Amer Intl Group (AIG), Options

With the broader market see-sawing between positive and negative territory, American International Group (AIG) has been consistently higher since the open. Currently, in mid-afternoon trading, the shares are up more than 4% on reports that the company may be restructuring the $35.5 billion sale of its AIA Group to Prudential of the U.K.

Options traders are taking this opportunity to roll existing positions in AIG from the soon-to-expire May series to the June series. Specifically, 9,000 May 55 calls have been sold to close for 27 cents each and 7,000 of the June 55 calls have been bought to open for $1.10. The trader in question effectively paid 87 cents per trade to roll these positions to the later-dated series.

Continue reading Option Buyers Extend Their AIG Bet

Option Buyers Extend Their AIG Bet originally appeared on BloggingStocks on Tue, 11 May 2010 15:40:00 EST. Please see our terms for use of feeds.

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Option Bulls Like the Look of Ford Motor

Beth Gaston Moon — Thu, 15 Apr 2010 14:30:00 EST

Filed under: Good news, Ford Motor (F), Options

As my old friend Mark reported earlier this morning, Ford Motor (F) posted strong sales in Europe last month. Sales increased 16.1% on the continent in March, making the Detroit-based automaker the leading seller of vehicles in the European market.

This news has not gone unnoticed on the Street today, as F has jumped almost 2% higher. The options market has perked up as well, as more than 205,000 option contracts have already traded today and calls are outpacing puts roughly six to one. Early on (shortly after the opening bell sounded), more than 21,000 May 15 calls were purchased for about 25 cents apiece. This is a small premium to put at risk for the potential unlimited upside above $15.25 (the breakeven price).

Continue reading Option Bulls Like the Look of Ford Motor

Option Bulls Like the Look of Ford Motor originally appeared on BloggingStocks on Thu, 15 Apr 2010 14:30:00 EST. Please see our terms for use of feeds.

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Potash Bears Emerge After Goldman Downgrade

Beth Gaston Moon — Wed, 14 Apr 2010 15:00:00 EST

Filed under: Analyst Upgrades and Downgrades, Bad News, Options, Potash Corp. of Saskatchewan (POT)

Potash (POT) has been severely underperforming the broader market of late, losing almost 15% of its value during the past four weeks. Things aren't looking much better today, as the stock has surrendered nearly 3% following a downgrade at Goldman Sachs. The brokerage lowered its rating on POT (along with its peer - Mosaic ( MOS)) to "neutral" from "buy" today. Goldman also trimmed its 12-month price target on POT to $123.69 from $131, citing a number of fundamental concerns, including weak volume and lower corn prices.

Continue reading Potash Bears Emerge After Goldman Downgrade

Potash Bears Emerge After Goldman Downgrade originally appeared on BloggingStocks on Wed, 14 Apr 2010 15:00:00 EST. Please see our terms for use of feeds.

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Take a LEAP with Citigroup (C)

Steven Halpern — Thu, 01 Apr 2010 10:30:00 EST

Filed under: Newsletters, Citigroup Inc. (C), Stocks to Buy, Recession, Financial Crisis

"Imagine a business backed by taxpayers; better yet, a business that gets taxpayers' money at zero percent interest (or close to it) and then loans money back out to those same taxpayers at a 3% rate, or more," suggests Karim Rahemtulla.

The editor of The Xcelerated Profits Report explains, "Sounds like a sweet deal, right? But it gets even better. Taxpayers also cover a good chunk of the bad debts, too. So if you have toxic loans, you get to write them off at almost no cost. Where is this financial utopia? Right here in the United States."

Continue reading Take a LEAP with Citigroup (C)

Take a LEAP with Citigroup (C) originally appeared on BloggingStocks on Thu, 01 Apr 2010 10:30:00 EST. Please see our terms for use of feeds.

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Cree and Netgear: 'Options' in Technology

Steven Halpern — Mon, 29 Mar 2010 12:30:00 EST

Filed under: Newsletters, Technical Analysis, Stocks to Buy, Technology

"We use a system known as 'expectational analysis ' which uses combination of fundamental, technical and sentiment indicators -- combined with a contrarian investment approach -- to select both our long and short trading ideas," explains Bernie Schaeffer.

The editor of The Option Advisor adds, "In the technology sector, our recent options recommendations include buying calls on Cree (CREE) and Netgear (NTGR).

Continue reading Cree and Netgear: 'Options' in Technology

Cree and Netgear: 'Options' in Technology originally appeared on BloggingStocks on Mon, 29 Mar 2010 12:30:00 EST. Please see our terms for use of feeds.

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Strange Things Afoot at Sherwin-Williams

Beth Gaston Moon — Mon, 22 Mar 2010 13:10:00 EST

Filed under: Options

Is something developing behind the scenes at Sherwin-Williams (SHW)? Options-trading activity would seem to suggest as much. On Friday, we saw unusual put buying at the April 65 put, as an investor bought 10,000 of these near-the-money contracts, perhaps preparing for anticipated downside in the shares.

Today, we have seen more than 7,500 April 70 calls change hands for 25 cents per contract, which was the asking price at the time (suggesting buying pressure). This compares to existing open interest of just 3,100. Breakeven for this particular strategy is $70.25, so the call buyer needs SHW to move nearly 7% higher by April 16 to put these calls in profitable territory.

Continue reading Strange Things Afoot at Sherwin-Williams

Strange Things Afoot at Sherwin-Williams originally appeared on BloggingStocks on Mon, 22 Mar 2010 13:10:00 EST. Please see our terms for use of feeds.

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Chasing Value: 43% Gain to Build a Position in KB Homes

Sheldon Liber — Wed, 17 Mar 2010 16:40:00 EST

Filed under: Market Matters, KB HOME (KBH), Options, Chasing Value[TM], Stocks to Buy, Housing

It's time to get serious about home builders again, and today I started building a position in KB Home (KBH) using options. Since the collapse of the residential real estate market three years ago prognosticators have been debating when the home builders might be worthy of investing your precious coin of the realm.

As is to be expected in these volatile times most were either too optimistic or pessimistic and few got it right. Like many stocks the home builders appear to have bottomed last March. In the case of KB Home shares were available at $10. Today they have been trading between $17.64 and $18.00 per share, up 80%, although it has been a rocky road.

That is a very healthy return, but there is much more upside to come. How would you like to make 43% quick? Yeah me too!

Continue reading Chasing Value: 43% Gain to Build a Position in KB Homes

Chasing Value: 43% Gain to Build a Position in KB Homes originally appeared on BloggingStocks on Wed, 17 Mar 2010 16:40:00 EST. Please see our terms for use of feeds.

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Bernie Schaeffer: Puts and Calls in Technology

Steven Halpern — Tue, 23 Feb 2010 13:00:00 EST

"We use a combination of fundamental, technical and sentiment indicators -- combined with a contrarian investment approach -- to select both our long and short trading ideas," says Bernie Schaeffer.

The editor of The Options Advisor explains, "In the tech sector, we recommend calls on software company Blue Coat Systems (BCSI) while also recommend buying puts on Internet security firm McAffee (MFE).

Continue reading Bernie Schaeffer: Puts and Calls in Technology

Bernie Schaeffer: Puts and Calls in Technology originally appeared on BloggingStocks on Tue, 23 Feb 2010 13:00:00 EST. Please see our terms for use of feeds.

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