Shares of Mechel OAO (MTL) are even today at 2.12.? MTL is in the lower end of the 52-week range.
Today paper traded 23750 MTL Apr 2 puts at .20 and 36329 Jul 3 calls for .15-.24.? ADV is 1910 contracts.? The OI is 256 and 14000 contracts.
The volume went up mostly in several large blocks.? None of the volume went up marked as spread but the sizes are likely related.? It looks like the put sale went up to finance the call buy. The odd thing is that the call volume is marking buy and sale for a .05 loss.? On balance the trade looks like a risk reversal looking for higher prices in MTL.? IV is down in Apr suggesting the ATM trade was a seller.
30-day implied volatility is 83%.? ?10-day implied volatility is 39%.? 30-day implied volatility is trading above the 10-day historical volatility.
Mechel OAO is a Russia-based integrated mining and steel company.?