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Option Selling in Qualcom (QCOM), Others, Sends VIX Lower

Posted May 10th 2010 3:30PM by Beth Gaston Moon (RSS feed)
Filed under: QUALCOMM Inc (QCOM), Options

Premium selling is pushing the CBOE Market Volatility Index (VIX) lower today – after a massive spike of more than 85% last week, the so-called "fear barometer" is down more than 25% today! Of course for the VIX to drop, option investors have to be doing something on their end. And they appear to be doing a lot of premium selling in an attempt to cash in on high volatility levels while the getting is good.

One isolated example of this phenomenon is QUALCOMM Inc. (QCOM), which has seen more than 10,000 October 33 puts trade today. Open interest was less than 6,000 heading into the session, suggesting that at least some of today's volume is trading to open. Around 10:00 AM Eastern time, a block of 8,400 contracts traded for $1.78 apiece. These executed near the bid price, suggesting they were sold to open and the investor took in roughly $1.5 million in premium.

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Bulls Buying Procter & Gamble Options

Posted Apr 13th 2010 2:00PM by Beth Gaston Moon (RSS feed)
Filed under: Procter and Gamble (PG), Options

The broader market is in negative territory today, but options traders are taking a bullish stance in a major blue-chip name as they evidently expect short-term upside in Procter & Gamble (PG). Within the first half hour of the trading day, more than 16,000 May 65 calls had hit the tape, trading for 30 cents apiece. As these calls are out-of-the-money by more than $2.00, the 30 cents consists only of time value, and there isn't much of that, as these options expire in about 5-1/2 weeks. The option came into the trading day with open interest of just 5,400, suggesting the majority of today's volume should translate as new positions.

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Kroger earnings disappoint; put sellers in the red

Posted Sep 15th 2009 12:00PM by Beth Gaston Moon (RSS feed)
Filed under: Earnings Reports, Bad News, Kroger Co (KR), Options

Kroger (NYSE: KR) reported second-quarter earnings Tuesday and the results were disappointing to the Street and to options investors who may have bet the other way.

First, the bottom line up front. The grocery retailer earned 39 cents per share, down from 42 cents in the year-ago period and a nickel short of what analysts were expecting. Sales, meanwhile, dipped to $17.7 billion from $18.1 billion, also falling shy of Wall Street's consensus view.

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