Read this..and get your $$$ of the table.
=DJ Options Report: Cisco Options Active As VIX Rises
18 Dec 15:33
By Gaston F. Ceron
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--Options traders focused on call options in Cisco
Systems Inc. and on the securities that track the Nasdaq 100 index during
Monday's session.
Out-of-the-money calls in Cisco traded actively at the Chicago Board Options
Exchange, the American Stock Exchange and the Philadelphia Stock Exchange. With
the stock down 10.7%, or $5.17, at $43, traders focused on Cisco's January 50
and January 55 calls. At the Amex, the January 50 calls were recently down
$1.88 at $1.88 on volume of 10,336 contracts. Open interest in these calls
going into Monday's session stood at 71,417 contracts.
An options trader at the CBOE, where 5,994 of Cisco's January 50 calls have
traded, said he hasn't seen very many large orders, but that the options
activity looks speculatively bullish for the underlying stock. "I think people
think the stock looks cheap and they're taking a shot," the trader said.
There has also been plenty of action on options on the Nasdaq 100 at the
Amex. Most of this has come on out-of-the-money call options. Paul Foster, the
options strategist at 1010WallStreet.com, said that some traders seem to be
speculating on a Nasdaq rally materializing before year's end.
But Foster was less sanguine. "I'm not bullish," he said.
The action came as the stock market diverged, with the Dow Jones Industrial
Average gaining ground while the Nasdaq Composite Index dropped. Options
traders appeared cautious, as the CBOE's Market Volatility Index, or VIX, which
measures certain Standard & Poor's 100 option prices to determine investor
sentiment, rose 0.18 to 31.38.
Elsewhere in the options market:
-The CBOE's equity put/call ratio recently stood at 0.45, with 269,805 puts
and 600,295 calls traded so far.
The ratio is traditionally interpreted as a contrarian sentiment indicator,
which holds that if too many tradersare bullish, then the smart approach is to
be bearish. Using this contrarian criteria, the index historically has been
considered a bullish sentiment indicator if it is around 0.75 to 1; neutral
from 0.40 to 0.75 and bearish if it is below 0.40.
-The CBOE's index put/call ratio was recently at 0.90, with 52,266 index puts
and 58,099 index calls traded so far.
This ratio is also interpreted as a contrarian sentiment indicator. The index
is considered bullish if the ratio is 1.5 or higher; neutral from 0.75 to 1.5
and bearish if it is below 0.75.
-By Gaston F. Ceron, Dow Jones Newswires; 201-938-5234;
gaston.ceron@dowjones.com
(END) DOW JONES NEWS 12-18-00
03:33 PM
Copyright 2000 Dow Jones & Company, Inc. |
