ratio put spread

STZ May Not Be a Done Deal

Submitted by msebastian on Thu, 02/14/2013 - 6:06pm

STZ was up very hard on the InBev, Modelo Deal rallying 37%.  But, I question whether the deal is 100% a go based on the option trading today.  Traders were jumping over themselves to buy puts in STZ today.  Check out the volume in March:

stz.png

livevolX (r) www.livevol.com

STZ typically has a larger call to put ratio, one can see in the open interest.  Yet, here we are on a day when volume was 20 times normal volume, puts were 1.5 times as active as calls.  

STZ1.png

livevolX (r) www.livevol.com

Will the Skew Ever Get Back to Normal?

Submitted by atg on Fri, 11/16/2012 - 4:07pm

 Part of the fun of working at Option Pit with Mark is the sessions we have throughout the week with clients ranging from beginners to professionals.  Some of our discussion groups talk about some esoteric trading topics, but more often than ot, it is an advanced subject on the trade that is happening now.  One of the glaring outliers right now is the flatness of index skew.  As a matter of fact, SPX skew is at year lows.

 

Chart by TOS (www.thinkorswim.com)

ALL is (Almost) Clear

Submitted by atg on Thu, 08/30/2012 - 1:00pm

Most of my trading ideas come from positions or experiences I have already had.  For the most part, I am not trying to invent new stuff (although, it happens pretty much every day at Option Pit with clients) but rather search the market for trades that look promising based on how I have seen things shake out in the past.  Part of trading is seasonality.  There is the summer season, the holidays, earnings etc.  You get the picture. Opportunities for trades happen in the time frames.

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