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Jud Pyle discusses the S&P 500 ETF (SPY) and put buying in Amazon.com Inc. (AMZN)
Jud Pyle is the Chief Investment Strategist for Options News Network. After four years with SBC Warburg, he joined PEAK6 Investments as an equity options trader and chief risk officer.
Amazon.com (AMZN) News: We aren’t seeing any company-specific news, although Sony (SNE) has announced it plans on adopting a common format for e-books. Target (TGT) also plans to take its online business in house rather than outsourcing to Amazon. September 80 puts are active today, with volume of nearly 9,000 versus open interest of 7,000. Investors are buying these for about $2.50 per contract and possible looking for short-term protection. The stock is down 1.8% at $84.41.
AMZN: $84.41 down $1.5500 or 1.80% volume: 1.72 million shares
Sep09 80.00 Puts: volume over 8952, trading last: $2.50 bid: $2.52 ask: $2.60 OI: 7036
Straddle: Aug09 85.00 trading $3.9350 price over strike: 4.6294%
Prev. Day Straddle: Aug09 85.00 trading $4.1050 price over strike: 4.8294%
BuyWrite: Jan10 85.00 Calls Yielding 11.02% call: $9.30
Prev. Day BuyWrite: Jan10 90.00 Calls Yielding 9.12% call: $7.70
SPDR S&P 500 ETF (SPY) News: The front-month, at-the-money August 101 straddle is trading at $2.64, or 2.6% over strike. Yesterday, this straddle closed at $2.73, or 2.7% over strike. This decay is basically in line with theta. The ETF is flat today, at $100.84, keeping a tenuous hold on the 100 level. Before the open, it was notably higher ahead of retail sales and jobless claims numbers.
SPY: $100.84 up $0.0400 or 0.04% volume: 39.50 million shares
Straddle: Aug09 101.00 trading $2.6400 price over strike: 2.6139%
Prev. Day Straddle: Aug09 101.00 trading $2.7300 price over strike: 2.7030%
BuyWrite: Mar10 101.00 Calls Yielding 7.07% call: $7.13
Prev. Day BuyWrite: Mar10 101.00 Calls Yielding 7.02% call: $7.07
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