Hi Twest. Thank you. Steve Sears handles the options report for Barron's. He also writes the Striking Price daily piece for Barron's Online. I've talked to him in the past and have offered to help, but nothing came of it. Thanks.
Hello, My source on the PXD trade is a CBOE floor broker. 5000 puts were sold, not bought. It was part of a spread. That's why it might have seemed like a purchase because it traded at the offer or asking price. I wrote it up correctly in this recap. Bullish three-way trade in PXD! Thanks for asking.
Volume in the iShares Emerging Markets Fund approached almost 900,000 on massive accumulation of put butterfly spreads. S&P 500 is testing July 25 highs. Stay on your toes and have a great weekend!
Hi, if you think the stock is going to $3, buying $3 puts might not be the best bet because, if the stock is trading for $3 at the expiration, the $3 put will be at-the-money and will expire worthless. It might make more sense to buy a $4 put when the stock is just above $4 and is expected to fall to $3.
As far as the order flow in FTR Friday, it looked like a lot of the activity involved buying of Mar 4 calls as the stock was falling to the 52-week lows of $3.81. It then rebounded somewhat. Beyond that, the activity seemed to include a mix of buying and selling across a number of different contracts. It seems like the volatility in the underlying triggered the heavy trading. I still don't know what the catalyst was for the morning sell-off. Let me know if you have any ideas.
I hope I answered all of your questions. If not, let me know.
I searched for Faber's comments. I think he is talking about the OTC derivatives market and not the listed options market.
The history of listed options trading dates back to 1973 and the beginning of the CBOE. Prior to that, options existed, but the market was inefficient. Prices were quoted in financial newspapers.
The OTC derivatives market is very different. Still, over time, more of these derivatives will become listed and cleared through the OCC. I don't think they will ever disappear entirely, but there will be more transparency and regulation.
The listed options market -- the puts and calls that I write about each day -- is definitely not going to zero. The trend is just the opposite, as the industry sets volume records year after year.
I didn't write anything on RIG yesterday, but I see now that 71,000 calls and 25,000 puts traded on the stock. Feb 45 calls were the most actives and some of those were being sold to open new positions, according to one data source. So that's not really bullish. Open interest in RIG calls increased by 23,000 contracts and therefore some of the activity was also closing (because 71,000 traded).
My guess is that there was a lot of opening and closing trades intraday, after the rumors swirled early and then Reuters reported that Petrobras was not interested in taking a stake in RIG.
Thanks for the feedback. There are services out there that offer specific options trade ideas. Most of these are fee-based. I don't know any free sources of options trading ideas and I would be skeptical of any newsletter, blog or service that touts free winning options trading ideas.
My recap is a snapshot of activity I write about throughout the day and not intended to offer specific trading ideas. Most of our readers are seasoned traders or people working in the industry. Some like to read about trading activity because the action can help to find interesting trades. Others simply want to know what's going on in the options market because it sometimes sheds light on what "smart money" is doing and positioning a a specific name.
If you want a link to a few services that offer premium products with specific trading ideas, feel free to shoot me a direct message and I can give you some examples.
We update unusual trading activity, including large trades, throughout the day at our web site. The premium service also includes a tool called Flow Monitor, which lets you scan the market for high volume, big changes in open interest, put-to-call ratios. Seeking Alpha readers can get on a free trial by sending me an email at fredruffy@whatstrading...
Hello, the info comes from a source on the options exchange floor. I get reports throughout the day from various exchanges. In this case, it was a large block of calls against a relatively small position in shares (sold short). The short stock is to hedge some of the delta risk of taking the position in the call options. $14 calls are 25 percent out-of-the-money, so it doesn't take many shares to hedge. The delta on the calls is only .24. But, the overall flow in MPEL was bullish and focused on April upside calls. One reporter noted to me that, with the Chinese New Year coming up, Macau gaming revenues might go up! Thanks for reading and for your question.
Wednesday Options Recap [View article]
Good luck!
Wednesday Options Recap [View article]
Wednesday Options Recap [View article]
Friday Options Recap [View article]
Friday Options Recap [View article]
Tuesday Options Recap [View article]
Friday Options Recap [View article]
As far as the order flow in FTR Friday, it looked like a lot of the activity involved buying of Mar 4 calls as the stock was falling to the 52-week lows of $3.81. It then rebounded somewhat. Beyond that, the activity seemed to include a mix of buying and selling across a number of different contracts. It seems like the volatility in the underlying triggered the heavy trading. I still don't know what the catalyst was for the morning sell-off. Let me know if you have any ideas.
I hope I answered all of your questions. If not, let me know.
Tuesday Options Recap [View article]
The history of listed options trading dates back to 1973 and the beginning of the CBOE. Prior to that, options existed, but the market was inefficient. Prices were quoted in financial newspapers.
The OTC derivatives market is very different. Still, over time, more of these derivatives will become listed and cleared through the OCC. I don't think they will ever disappear entirely, but there will be more transparency and regulation.
The listed options market -- the puts and calls that I write about each day -- is definitely not going to zero. The trend is just the opposite, as the industry sets volume records year after year.
Thanks for the question.
Tuesday Options Recap [View article]
I didn't write anything on RIG yesterday, but I see now that 71,000 calls and 25,000 puts traded on the stock. Feb 45 calls were the most actives and some of those were being sold to open new positions, according to one data source. So that's not really bullish. Open interest in RIG calls increased by 23,000 contracts and therefore some of the activity was also closing (because 71,000 traded).
My guess is that there was a lot of opening and closing trades intraday, after the rumors swirled early and then Reuters reported that Petrobras was not interested in taking a stake in RIG.
Tuesday Options Recap [View article]
Tuesday Options Recap [View article]
Friday Options Recap [View article]
My recap is a snapshot of activity I write about throughout the day and not intended to offer specific trading ideas. Most of our readers are seasoned traders or people working in the industry. Some like to read about trading activity because the action can help to find interesting trades. Others simply want to know what's going on in the options market because it sometimes sheds light on what "smart money" is doing and positioning a a specific name.
If you want a link to a few services that offer premium products with specific trading ideas, feel free to shoot me a direct message and I can give you some examples.
Friday Options Recap [View article]
Good luck!!
Friday Options Recap [View article]
Thursday Options Recap [View article]