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  • Option Buzz 0 comments
    Mar 1, 2010 1:34 PM | about stocks: CMCSA, MWW, XLY, OA

    The stock market is sitting solidly higher allowing the VIX to contract 25 to 19.22 and the equity only put/call ratio has moved to a neutral 0.56 compared to the 20-day moving average of 0.71.  Option volume is running 15% below its 30-day moving average.  Sectors seeing bullish order flow include materials and home construction, chemicals and semiconductors. 

    Comcast (NASDAQ:CMCSA)  sees notable transaction in 2012 LEAP puts as 12,500 of the $12.50 puts and 2,000 of $15 puts trade in what appears to be 1×6 ratio spread for $5.10 net credit.  Assuming this is a stand alone position its maximum profit would be achieved if shares trade down to $10 in two years.  But given that CMCSA had hit an eight low of $11.10 back in March of 2009 it is more likely this is a bet that shares will not sink back below that level in coming years and the premium collected will be retained. 

    Monster Worldwide (NYSE:MWW) is seeing active call buying with volume running 5x the daily average on takeover chatter.  The most active strike is the March $15 call with 4,000 contracts traded compared to prior open interest of just 1,094 contracts.  The April $15 call has traded 1,600 contracts against prior open interest of 64 contracts. 

    Following this morning’s consumer spending number which increased for the fourth consecutive month the Spyder Discretionary (NYSEARCA:XLY) is hitting a new 52-week and it appears someone taking advantage of the gains to sell call premium as 5,000 of the April $31 calls traded.  The volume occurred in two 2,500 contract blocks of 55c and 50c bid price and prior open interest in the strike was just 100 contracts so this is likely an opening sale, possibly against long stock to create a covered position. 

    Alliance Techsystems (ATK) shares are up 20c to $79.65 and option volume is 2x the daily average driven by an August $80/$90 call spread which was purchased 1,000x for a $3.50 net debit.  Shares of the Minneapolis based aerospace company had slid 18% from a $92 down to $77 during the first six weeks of the year on concerns of NASA budget cuts.

    Disclosure: None
    Stocks: CMCSA, MWW, XLY, OA
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