Note: The Daily Option Update is provided by Stock Options Specialist Paul Foster of theflyonthewall.com.

Volatility Index S&P 500 Options-VIX up .27 to 10.59.

New Century Financial Corp. NYSE: NEW implied volatility bid up as NEW sells off on restatement. New Century Fin'l, a real estate investment trust, providing mortgage products to borrowers nationwide, is recently down $8.72 to $21.45. New Century Fin'l announced it will have to restate operating results for the first three quarters of 2006. Merrill Lynch downgraded NEW to Sell, Jeffries lowered to Hold & Friedman Billings downgraded NEW to Underperform. NEW March option implied volatility of 69 is above its 26-week average of 42 according to Track Data, suggesting larger price risks.

H&R Block-NYSE:HRB April option implied volatility & put volume elevated on hedging. H&R Block is recently down $.30 to $24.54. Soleil said on 2/7/07 "we rate H&R Block Buy; $29 price target. We believe Block is close to entraining sale of the company (whole or in parts)." H&R Block call option volume of 2,945 contracts compares to put volume of 42,299 contracts. HRB April option implied volatility of 33 is above its 26-week average of 26 according to Track Data, suggesting larger price fluctuations.

Option volume leaders today were: Cisco-(NASDAQ-CSCO), Akamai (NASDAQ: AKAM), Bristol Meyers Squibb (NYSE: BMY) and Apple Computer (NASDAQ: AAPL).

Daily Option Update - February 8, 2007 originally appeared on BloggingStocks on Thu, 08 Feb 2007 15:50:00 EST. Please see our terms for use of feeds.

Amaranth Advisors LLC shows the perils of fast money in the hedge fund world. While the fund had a sterling performance since 2000, things came to a stunning conclusion over the past week.

Because of risky bets on natural gas, it looked like the fund lost roughly 35% this year (ironically, one of the selling-points of this fund was its alleged focus on reducing volatility).

Well, the results have been much worse - according to a letter from the fund's leader.

You see, the fund had to unwind its positions. And, as the old saying goes, there is lots of money to be made when there is "blood in the streets." So, this week, Amaranth lost an additional $1.4 billion.

Those who bought a large amount of these positions include Citadel Investment Group, a $12 billion hedge fund, and JPMorgan Chase. This certainly gives new meaning to another old Wall Street phrase: "pass the trash."

Continue reading Mega-loser hedge fund still taking stupid pills

Mega-loser hedge fund still taking stupid pills originally appeared on BloggingStocks on Thu, 21 Sep 2006 11:55:00 EST. Please see our terms for use of feeds.