Options

More Room For GRPN to Tank

Not exactly the best day for Groupon.  On Friday, they announced that they were going to have to restate revenues, again.  Needless to say, the stock got crushed, and with the added uncertainty, option implied volatilities went up.  But does that mean it is too late to take action on this name?  Is it too late to buy premium in hopes the stock drops?  My initial thoughts are no.  Take a look at the speed at which Groupon's stock can take a dive:

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Bond and S&P IV In a Strange Place

To show you how great of an effect that the Fed, Europe, and congress is having on the market, I thought I would point out something unique that is currently happening:  Here is a quick look at volatility in the SPX

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Livevol (r) www.livevol.com

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Option Pit's Research on AAPL as Seen on Mad Money

There has been a bit of confusion as to what exactly what the reserach Jim Cramer quoted Mark Sebastian on last night meant (watch the Video here).  Here is the research that was used along with a slightly more indepth description.  It should clear up any confusion.  As a follow up,  you can catch our live webinar on using options to trade stock earnings on Feb 15th.  Register here.

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SPX IV a Touch Troubling

Don't forget to register for tomorrow's webinar.  You can do it here.

I have been saying for some time that I thought we were going to touch 1300.  Now that we have, where are we going from here?  I'll be honest, I am on the fence.  There are a few things coming out of option prices that make me bullish:

1.  VIX futures are in a somewhat heavy contango

2.  Market momentum

3.  The way the SPX has shrugged off bad news on Friday

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VIX Futures Not Exactly a Harbinger of Bad Things

We will be having the second free webinar in our using the VIX to trade series.  Go to our EVENTS page to register.  Also, make sure to read the Option Pit Challenge below:

As I was looking at the VIX trading relative to the SPX, I was struck by a few things:

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