FYI, correction of Feb 9 news on DELL
02/10 03:13 CORRECTED - U.S. OPTIONS/Dell vols rise ahead of earnings -2-
In CHICAGO item headlined "U.S. OPTIONS/Dell vols rise ahead of earnings" please read in seventh paragraph ... On the Philadelphia Stock Exchange, where Dell options are exclusively listed ... instead of ... On the American Stock Exchange, where Dell options are exclusively listed ... (corrects exchange).
A corrected version follows.
CHICAGO, Feb 9 (Reuters) - Implied volatility on Dell Computer Corp. <DELL.O> options edged higher in active trading on Tuesday as traders looked ahead to the group's fourth quarter results, due on February 16.
Implied volatility, a key factor in determining options prices, jumped to around 94 percent for the February at-the-money contract from about 80 percent on Monday and from an average of around 63 percent during the past month.
"Earnings aren't out until next week. This spike (in volatility) is sooner and greater than you'd expect. Maybe the Street is looking for a disappointment in growth or something," said Paul Foster, investment strategist and editor of 1010WallStreet.com.
According to a First Call survey of 31 brokers, the mean estimate was for a per share profit of $0.31. Estimates ranged from $0.28 to $0.33 per share.
The stock was down 4-3/16 to 99-7/8 at 1041 CST/1641 GMT on volume of 12.6 million shares, making it the most actively traded stock on the Nasdaq.
Larry McMillan, president of options advisory group McMillan Analysis, noted that there was some speculation of a stock split, which also could have contributed to the rise in options volatility.
On the Philadelphia Stock Exchange, where Dell options are exclusively listed, the February 110 and 105 calls were the most actively traded, with combined volume of almost 6,700 contracts. The February 100 and 85 puts also drew strong interest, registering trading volume of more than 4,300 contracts.
Elsewhere, implied volatility on Bankers Trust <BT.N> options rose only slightly with the stock down 2-3/16 to 85-1/2.
The stock fell under pressure following reports quoting Deutsche Bank AG <DBKG.F> chief executive Rolf Breuer as warning in a German television interview that its takeover of BT would not make economic sense if it was delayed too long.
"Arbs own the (BT) stock and they can't sell it $2 in the hole without more concrete information," Foster said.
"You'd think they might buy puts to protect themselves.... The market must be optimistic that the deal will go through," he added.
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