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Aqumin provides interactive real time data visualization for financial services. The cutting edge user interface increases user's analytic capabilities and brings actionable opportunites to the forefront. Users across trading, risk, and compliance use Aqumin tools to spot trends, relational... More
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  • Hold‘em With ZNGA

    Aqumin Volatility Newsletter 04/03/2013 - $ZNGA

    As I sit watching the market sell off a little bit I am reminded that stocks are just a game of numbers. We get good numbers and we rally and we get mediocre numbers and we tank. The jobs number was not great this morning and we tanked. Most of the jobs numbers have just been ok anyway so I guess it was time for a miss. The fact that we are getting closer to what the new health care bill has in store for employers is probably not helping. The number missed and we sold off. So when a stock does not sell off into a broad market decline I notice.

    Take ZNGA today. The name has been a poster child for everything wrong with a public social media company. Yet it is still here. I have followed it for most of the year and got real interested in it when it started trading for the cash + property value of the company in mid-November. It got real interesting when some states started to allow certain forms of internet gambling and ZNGA already had a presence in the non-cash space. ZNGA started to take cash bets in Great Britain today. That could start moving to the USA relatively fast. The good thing for ZNGA is they are not tainted by the 15 years or so of offshore online gambling business. They come in clean with the latest technology.

    Looking at how the volume is dispersed on my OptionVision™ landscape, most of the trade centered around the May 3.5 calls. The Apr cycle actually had some volatility go down. The May calls are the cycle that contains the earnings announcement and will have a little more room to run should the online gambling thesis keep working.

    (click to enlarge)

    I think the volume is looking for more upside in this name and not just on the short pop we got this morning. ZNGA traded as high as $4 with just the potential of moving into cash gaming 3 weeks ago so I don't think that is a stretch. It looks like a lot of paper sees it that way to. I like the idea of selling OTM put spreads in here in the May or Jun cycle. I don't think the transformation will be over night and the higher IV is nice to collect while the company puts it all together.

    I have a position in ZNGA.

    Disclosure: I am long ZNGA.

    Tags: ZNGA
    Apr 03 5:17 PM | Link | Comment!
  • No One Likes Facebook Juice

    Aqumin Volatility Newsletter 03/28/2013 - $FB

    The remarkable thing about FB as a name is it is barely in the news anymore. The lock ups are going away and the stock has become, well, very boring. It is as if the initial hype was so big that the investment bankers just want it to slowly go away until the magic number comes back into view. That number is the IPO price which the name was approaching in early part of the year 2013. The 100 billion dollar valuation is a ways away right now and it won't be hitting it anytime soon. That does not mean it won't an interesting trade between now and whenever it gets back to the IPO price of $38.

    Yesterday FB was one of the few bigger cap tech names showing some real strength. The stock has been on a recent slide from $31 and change and started changing course yesterday. The momentum view below shows FB trading stronger than the other big cap (those are big blocks) names in the tech sector in AlphaVision™ for Bloomberg. You just connect AlphaVision™ to the Excel API in Bloomberg.

    (click to enlarge)

    Yesterday FB looked like it wanted to run. But today looking at the options all of the action has cooled somewhat. I have the near term volatility dying in April as you can see below in the OptionVision™ landscape. The move we had yesterday is slowly drifting away, and with it the implied volatility in the options.

    (click to enlarge)

    If you note the height of the buildings above, the implied volatility is much higher in the earnings cycle coming at the end of April. The Apr option implied volatility is getting to near 52 week lows and is the best way to play a little rally back to earnings. We saw a little smoke yesterday as FB rebounded and here is a chance to grab some options for better prices.

    Tags: FB
    Apr 03 5:11 PM | Link | Comment!
  • Eldorado Gold Corp Is Looking At A Bottom

    by Andrew Giovinazzi

    EGO is looking at a bottom

    As I sit around this Friday waiting for some news to come out of Europe to move my volatility positions, I can't help but think how many people even know where Cyprus is? A country with less than 1 million people in the middle of Mediterranean Sea can move the US Treasury market. That is the state of our global economy. It is the latest in the saga of European Debt soap opera now entering its 4th season. So when the broader market picture gets murky I like looking at other names that have something going on in them. Here is an OptionVision™ snapshot of EGO.

    Eldorado Gold Corp. (NYSE:EGO) looks a lot like most of the miners lately. Namely they are trading at 52 week lows. EGO makes some cash, but all of these names seem like they are in the way of an exodus of money from gold mining stocks. This might be due to the fact that the expected inflation from the Fed's bond buying program has not materialized yet and gold has gone nowhere. The goldbugs are in hibernation for now. One thing that has materialized in EGO is a buyer of calls. And like I noticed last week the fact that customers are buying options is telling.

    (click to enlarge)

    A customer is buying 10s of thousands of EGO Jul 10 calls. The fact they are buying these options in and of itself is important because capital is being spent on a sustained upswing. Like the index calls I saw last week the paper is thinking rally between here and the summer. I am seeing more and more of this kind of activity even into the weakness generated by the Cyprus issues. Paper is looking past the current problems into the golden future beyond. I have to agree with them. Just buying a July ATM call spread in here should work.

    Chart data provided by ORATS, visuals provided by Aqumin.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Tags: EGO
    Mar 26 10:10 AM | Link | Comment!
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