Options Update: Bank of America (BAC), Fannie Mae (FNM) & Freddie Mac (FRE)
Bank of America (BAC)
BAC volatility at 55 into EPS and financial guarantors' concerns.
BAC is currently down $1.24 to $35.69. BAC will report Q4 EPS on January 22.
BAC announced on January 11, 2008 that it will pay CFC shareholders 0.1822 share of BAC for each share they own.
BAC call options volume of 35,435 contracts compares to put volume of 45,080 contracts.
BAC February option implied volatility of 55 is above its 26-week average of 32, suggesting larger risk.
Fannie Mae (FNM) & Freddie Mac (FRE)
Fannie Mae (FNM) & Freddie Mac (FRE) volatility spike on financial guarantors' concerns.
FNM is currently down $3.08 to $31.92. FNM February option implied volatility of 95 is above its 26-week average of 49, suggesting larger price fluctuations.
FRE is recently down $.80 to $28.29. FRE February option implied volatility of 128 is above its 26-week average of 49, suggesting larger price movement.
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About Paul Foster
Paul Foster is a former member of the Chicago Board Options Exchange with 21-years of professional experience in the capital markets, investments, trading, corporate finance, arbitrage, options and mergers & acquisitions. His writing about the options market has appeared in a wide variety of publications.
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