Option Block 90: The Voice of Options
Option Block 90: The Voice of Options
TRADING BLOCK: Research in Motion (RIMM) - The future looks bleak. \u201cThe Widowmaker\u201d strikes again - Netflix (NFLX), which was trading $300 just two months ago, down 40%. Yet another \u201crogue trader\u201d on the loose - this time it costs UBS $2 billion. Commodities rundown - gold is coming down, is this the right time tighten up your hedges?\xa0
ODD BLOCK: Unusual and interesting options activity in:\xa0 UBS AG (UBS) - a staggering $2 billion lost in trading as a rogue trader racked up unauthorized dealings. Call buying and put selling on the stock appear to be the most employed strategies of the day, with investors expecting shares to recover in the next five weeks.\xa0 Amerigroup Corp. (AGP) - ahead of the company\u2019s analyst meeting in New York tomorrow morning, an opening buyer appeared in the September 45 Calls, paying the offers of $0.25-$0.35 for approximately 3500 contracts. These options expire tomorrow after the close so these trades will need the stock to climb another 4.6% to begin to see any profits.\xa0\xa0
XPRESS BLOCK: Tim Navabi takes the reins and discusses the hectic day today at OX due to "The Widowmaker" aka Netflix, as well as the upcoming expiration of September futures.\xa0
STRATEGY BLOCK: Mike Tosaw illuminates us on some in-depth options strategy. First, with the upcoming expiration, if you're not ready to hold a stock and you're short a put, maybe you'll want to close out those penny options. Second, make sure you know position delta before doing ratio spreads.\xa0\xa0
AROUND THE BLOCK: An update on RIMM. Still some concern over Greece, also some concern about expiration upcoming. Not too much else lighting up the tape on the earnings front though. Play it safe this weekend.