option volatility

NDX goes Stink, Stank, Stunk


Fake news, real news, no news, blue news…  it appears that we have had a lot of flip flopping and flat out surprises on news stories lately from the failure of the tax bill to the miraculous resurrection of the same.  SPX found a way to trade to ATH briefly today but the NDX has not been so fortunate of late.  Granted the rally in 2017 has been spectacular for NDX.

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YHOO getting antsy for the BABA IPO

After the record run to all-time highs stocks are stuck today while the violence in the Ukraine continues.  We have highlighted the 5% realized vol in the SPX and will not rehash that but stocks are setting up to go somewhere.  A name that has been setting up to go somewhere is YHOO.

The stake in BABA has really driven the value in YHOO’s shares recently and the name has been in a range from $33 to $38.  It is now at a 3  month high as BABA just released a decent earnings report as it sets to IPO.

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LNKD volatility is cheap

Yet another rally on no bad news as stocks love the lack of action overseas.  That was kind of a mouthful.  There is no doubt that the gravity is pulling stocks up overall.  The rally to all-time highs in the face of overseas unrest is just another reason to believe in the rally.  Another reason to believe is the lack of a bid in IV.  The VIX cannot hold a bid for anything even as a near panic hit volatility of Friday morning.  By the end of today it was all forgotten.

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FXE November Vol Is Cheap

I will be honest,  I do not spend a lot of time dealing in currency options.  For starters, the futures options do not have that much liquidity.  This is because most of the volume is traded over the counter.  The FXE currency pays a wierd dividend and has a management fee.  It also is not the most liquid product; although, the front months do trade.  However, when something gets out of whack, no matter the product, one should trade it.

Take a look at the term structure for FXE:

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Who Stepped on the Gold Bugs?


We had a brisk sell off today on the rain ain’t so great in Spain news.  ADP payrolls were just so so but still growing, and the Fed is iffy on QE Next.  So this was perfect opportunity to take profits?  Seems like everyone sold the popular stuff, but there was one spot where the market hit the ugly button.  The gold miners got laced today with many hitting 52 week lows. 

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