Option Block 90: The Voice of Options
TRADING BLOCK: Research in Motion (RIMM) – The future looksbleak. ?The Widowmaker? strikes again – Netflix (NFLX), which wastrading $300 just two months ago, down 40%. Yet another ?rogue trader?on the loose – this time it costs UBS $2 billion. Commodities rundown -gold is coming down, is this the right time tighten up your hedges?
ODD BLOCK: Unusual and interesting options activity in: UBS AG(UBS) – a staggering $2 billion lost in trading as a rogue trader rackedup unauthorized dealings. Call buying and put selling on the stockappear to be the most employed strategies of the day, with investorsexpecting shares to recover in the next five weeks. Amerigroup Corp.(AGP) – ahead of the company?s analyst meeting in New York tomorrowmorning, an opening buyer appeared in the September 45 Calls, paying theoffers of $0.25-$0.35 for approximately 3500 contracts. These optionsexpire tomorrow after the close so these trades will need the stock toclimb another 4.6% to begin to see any profits.
XPRESS BLOCK: Tim Navabi takes the reins and discusses the hecticday today at OX due to “”The Widowmaker”” aka Netflix, as well as theupcoming expiration of September futures.
STRATEGY BLOCK: Mike Tosaw illuminates us on some in-depthoptions strategy. First, with the upcoming expiration, if you’re notready to hold a stock and you’re short a put, maybe you’ll want to closeout those penny options. Second, make sure you know position deltabefore doing ratio spreads.
AROUND THE BLOCK: An update on RIMM. Still some concern overGreece, also some concern about expiration upcoming. Not too much elselighting up the tape on the earnings front though. Play it safe thisweekend.
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