>>what's going on with BCE options lately?
Well, lots, in a word. BCE has been putting on some awesome moves. I was talking to a friend of mine who is an Intel specialist in New York and I mentioned how Bell had a $4 move that day and how in the past it hadn't moved that much in a year. The next day it had a $6 range on the downside. Implied volatilities have increased about ten percent to
33 on the calls and 35 on the puts. I can't see a historical volatility of 43 as E-trade suggested unless they are using a very front-end loaded weighted system. However, BCE's IV has always been lower than its HV since it is so widely-held, and institutions and retail alike love to write against their holdings. Anyway, we've had
great two-way trading the last little while, which is all any trader can ask for.
There's been some unusual activity in ABX recently. After that stunning run-up to the $38 range, ABX has plunged to its recent $26 level, and some increase in call vol is to be expected as shorts cover and bottom-pickers take a shot, but we've had one institutional buyer single-handedly move the vol from about 44 to 52 particularly in the Januarys. The other interesting phenomenon is the public has been aggressive put sellers for about the last six months. I've never seen so much opening put writing in my career. The fact that ABX keeps sliding hasn't deterred them at all, very little covering has taken place (and since it's retail, I know they haven't been shorting stock against it). Anyway, it's left me in the unusual position of long stock, long puts and short calls. It's a natural tripo, and I'm sure there's money in it, but I really don't like it. I hate paying interest on carrying longs.
Inco has had some interesting moves lately. I have no idea why, but it scoots from $28.50 to $31.50 and back with some regularity. I've got a 'rocking chair' position where I sell my longs as it goes up and cover my shorts as it comes down. Sweet when it works.
Ballard recently broke important support at C$42 and has slid to about $38. It did a lot of work at the $42 level, so this could be a significant break-down. Too bad, I really believe in the company. It has the three Ps...product, patents, and partners, but I guess the market is tired waiting for positive earnings. Any lower and I'm putting some in my RRSP.
It now looks like the move to Montreal will take place in March, although I'll believe it when I see it. It's sure going to be a big adjustment--new floor, new system, new city, away from my family. I'm getting to be sort of an old dog for too many new tricks.
I've been checking this board almost daily (although SI has been giving me a lot of error messages like "Connection refused" or "Server hangup". I too would like to see it come back to life.
Happy trading.
Porter
(TSE options specialist in ABX, BCE, BLD, N)
E&OE |
