StockFetcher Forums · General Discussion · Straken: Check out PCL into tonights earnings<< 1 2 3 >>Post Follow-up
gmg733
619 posts
msg #87583
Ignore gmg733
modified
2/1/2010 1:16:25 PM

Huge Put buying today, about 10x normal 10 day average and 2x open interest. Can't tell if it is selling or buying, but the vol on these is way over inflated.

Company: PCL
Historical Volatility:


10-Day 1-Month 2-Month 3-Month
24% 20% 20% 23%

Expiration Month Expiration Year Strike Price Option Type Implied Volatility Market Price Calculated Price
February 2010 35 PUT 41.855 .60 0.0992

Feb 35 PUTS ask is .60 and the calculated price is .09



medowz
59 posts
msg #87592
Ignore medowz
2/1/2010 2:47:27 PM

Short Interest is almost 11% of the float according to shortsqueeze.com. They calculate the Days to Cover at 9.8 at average volume. I think earnings come out after the close today. FWIW

gmg733
619 posts
msg #87595
Ignore gmg733
modified
2/1/2010 3:00:14 PM

Earnings is after the bell.

Thanks for the info.

straken
469 posts
msg #87609
Ignore straken
modified
2/1/2010 9:49:30 PM

gmg733
2/1/2010 1:16:25 PM

Thank for the info, I didn't see it until tonight. Looks like 1 trader sold 2500 of the 35p @ .60
I thought I'd see a credit spread somewhere on another month but I don't. He may open an equal amount of calls at another strike tomorrow but its most likely just selling overpriced puts looking for the time decay.

I did some light shopping today myself : ) Hope I didn't throw caution to the wind too early.

FCX BTO FEB 70c @ 2.65
POT BTO FEB 100c @ 5.00
IOC BTO FEB 65c @ 2.80
BIDU BTO FEB 420c @ 21.00
GS BTO FEB 155c @ 3.25

Feb 2
100 GS STC @ 4.80 out
50 PC STC FCX @ 4.25 holding 50
30 PC STC POT @ 6.30 holding 20
30 PC STC IOC @ 5.20 holding 70
BTO 50 MA FEB 260c @ 6.50

3:25 pm
STC 50PC IOC @ 5.30 holding 20
STC 50 PC FCX @4.65 out
STC 20 PC POT @ 7.00 out

gmg733
619 posts
msg #87611
Ignore gmg733
modified
2/1/2010 10:01:23 PM

I'm staying loose on my longs. A lot of stuff should rally right into resistance and head south. Have a look at V. Might be a good short around $86. GS looks good for a bounce till about $160.

All the stocks you bought except IOC are on what I call my core list. These are stocks I watch every day for opportunity in addition to scans. However right now I'm watching for the pull backs before getting short.

One that I think is an out right short is IT down to around the $20 level. LLTC looks interesting on the long side for its first pull back after breaking trend.

karennma
6,827 posts
msg #87628
Ignore karennma
modified
2/2/2010 9:28:21 AM

gmg733
- gmg733
modified 2/1/2010 1:16:25 PM
Huge Put buying today, about 10x normal 10 day average and 2x open interest. Can't tell if it is selling or buying, but the vol on these is way over inflated.

==================================================================================

I'm watching this to see if open interest and put volume matters.

karennma
6,827 posts
msg #87629
Ignore karennma
2/2/2010 9:31:27 AM

GAP UP!!!
I REST MY CASE!!
You cannot, ... I repeat ... you cannot look @ open intersest and call/put volumes to determine whether a stock will go up or down @ earnings because you don't know if most of the puts or calls were sold OR bought.



karennma
6,827 posts
msg #87630
Ignore karennma
modified
2/2/2010 9:36:54 AM

I opened this issue up for discussion last week, but someone chose to insult me instead.
("Maybe you just dont have the mettle for options.")
What "mettle" has to do with options trading is beyond me! With options, either you're right or you're wrong.
It's a zero sum game. Has nothing to do with "mettle".
If you think you can determine the direction of a stock prior to earnings based on open interest and put/call volumes, then prove it!

SCROLL DOWN.
Scroll down

gmg733
619 posts
msg #87643
Ignore gmg733
modified
2/2/2010 10:34:51 AM

Karen,

I think you missed the point of the discussion. There was a large shift in PUTs and the premium was way high, so someone was selling PUTs. You are correct in that you can't look at P/C ratio alone. You have to know whether the calls/puts are being bought or sold.

If there was a large shift and the preimum was low and you see buying at the bid, expect a move in that direction. Today those puts are trading at .20 on the ask. So if you sold at .60, buy back at .20 you just made some good bank. The trader that did this sold 2500 contracts.

I contend the really 'smart' money are the option sellers.

karennma
6,827 posts
msg #87664
Ignore karennma
2/2/2010 11:35:17 AM

Thanks, gmg.
And THAT was the point of my previous post last week .... SELL the option and keep the premium.
Frankly, the person who makes out like a bandit on the option is the SELLER.
Appreciate your clarification.
I hope others are paying attention to this, to avoid confusion.


StockFetcher Forums · General Discussion · Straken: Check out PCL into tonights earnings<< 1 2 3 >>Post Follow-up

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