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OptionsNews
An ahead-of-the-bell look at the market's biggest stories and a review of unusual options activity. Filled with smart market analysis from the ONN.tv team, "Options News" turns the market's top headlines into trading intelligence, hosted by Karla Yeh.
Put buyers scramble in Potash while investors express bullishness in Freeport McMoRan.
Volatility Matters in Commodity Options Volumes
Put buyers scramble in Potash while investors express bullishness in Freeport McMoRan.
On today’s Options News, Carrie Long and the www.ONN.tv team look at Tuesday’s pre-market price action in the broader market, highlighted by a surge in S&P 500 futures ahead of the commencement of the FOMC meeting today. On Monday, the Dow dropped 40 points to 9,779, and the S&P 500 fell nearly four points to 1,064. The CBOE SPX Volatility Index (VIX) popped up slightly to 23.95. Investors could be looking for more movement throughout the rest of the year amid rumors of recovery underway.
Early Market Indications
Ahead of the U.S. market open, S&P 500 futures are up 7.5 points to 1,068. International markets are also up, with Hong Kong up 1% and Europe up 0.7%.
Options Volume and Volatility in Commodity Stocks
Heavy put volume hit the tape in Potash (POT) as buyers of the Oct. 90 puts scrambled after the company warned of downward guidance. We also saw a call spread buyer in Freeport McMoRan (FCX) following call selling activity on Friday. Looking at historical and implied volatilities, we see that volatility has dropped to 25 from 53 during a 10-day period. Investors who interpret this activity as cheap options could take advantage and get in, but be sure to analyze volatility using tools on OptionsHouse.com first.
ONN.tv continues its Wednesday Webinar series tomorrow at 4:30 p.m. eastern. Join Kevin Cook and Larissa Miller for an introduction to put-call parity. Be sure to sign up by clicking on the webinars tab at www.onn.tv to reserve your spot. Sign up now – spots fill up quickly!
For more breaking news and investment pointers on the options market, stay tuned in to ONN.tv.
