Options update for July 17...Nobody's right if everybody's wrong.
I'm sorry for taking the last week off from posting, but it's been pretty rough for me. My mother has started chemo again but it's weeks, not months; I've had the flu (nice, huh, with 95 degree weather);and
the market has had me busier than a one-armed wallpaper hanger. Anyway, I hope we can get this thread revived...there sure is a lot to talk about with this market.
BCE: Might as well start with the star performer. Bell has been in the top five all week in volume, and the play has started to put some deserved volatility into the options. We started the week at about 20 or 21, and right now 25 is dialed in and still doesn't cover the interest in certain lines--the Aug 45 calls are well-bid on about a 30 vol and the same is true for the Aug 42.5 and Nov 42.5 puts. The populi is voxing on both sides...I still lean towards the short side, particularly after today's action. Can't complain...I've had a good pass on Bell this week. (25*,25*)
ABX: Barrick whip-sawed me severely this week, jerking around all over the lot, getting down to C$26.20 (I think...my eyes were glassed over) and then gyrating around to today's close at 30.65. The public has forced me into my least favourite position--long stock, short puts and short calls. It is the highest-risk position you can have, and I have it big-time. Luckily a lot of it comes off tomorrow with the July expiry, but still plenty of exposure. Same story here--the vol has moved up solidly with the stock's swings. Gold up $6.00 today...if spot gets to about $325, I expect the all-time record short interest on the Comex might prompt a frenzy of short-covering. (35,33.5)
N: Not much to say about Inco...mid-week the public had a spurt of put selling, which vexed me some because it forced me to buy stock, which I hate to do. I didn't buy much, though, which turned out OK because the stock dropped from $42 to 40.50, where I reluctantly bought some in. This stock should be acting better, but I won't get aggressive until I see a few good day's action from it. (27.5,26.5)
The exchange management has pulled some more doozies this week...TEN, GNU, almost too many to mention. After much thought, I decided to stand for election to the Toronto Futures Exchange board. No guarantee I'll get elected, but I hope so. As they have the new "governance" structured, TFE board members will automatically serve on the DIEC (don't ask), which will oversee the direction and market model of the new system. Automation unfortunately looks like a done deal, but there are still the rules and policies to be determined. Rear-guard action to be sure, but perhaps some elements of fairness can be preserved.
This market looks like toast. I know I've said this about a 1000 points ago, but now I *really* mean it.
Happy trading.
Porter |
