Posts Tagged ‘HNT’

Quicksilver Resources, Inc. Options Activity Jumps Late in Session

Today’s tickers: KWK, MCCC, EWZ, NSC, HNT, EFA, JNJ, GT & LVS

KWK – Quicksilver Resources, Inc. – The independent oil and natural gas company’s shares recovered late in the session, adding 0.50% to stand at $12.18 as of 3:07 pm (ET), after commencing the trading day in the red by 0.30% to touch an intraday low of $11.75. Options investors all but ignored Quicksilver until this afternoon when both puts and calls in the July contract started to change hands. Roughly 10,000 puts were exchanged at the July $11 strike for an average premium of $0.44 apiece. Simultaneously, investors traded about the same number of calls at the higher July $13 strike for an average premium of $0.79 each. It looks like some options strategists populating KWK are selling strangles on the stock because they expect shares to trade within a specified range through expiration. Strangle-sellers pocket an average gross premium of $1.23 per contract, and keep the full amount received as long Quicksilver’s shares trade within the $11.00 to $13.00 range through expiration day. Investors short the strangle face losses should shares rally above the upper breakeven price of $14.23, or if shares slip beneath the lower breakeven point at $9.77 ahead of expiration. Other options strategists may be utilizing the same strike prices in the July contract to enact bullish risk reversals. Investors employing the risk reversal likely sold the July $11 strike puts in order to offset the cost of buying the July $13 strike calls. Average net premium paid for the transaction amounts to $0.35 per contract and positions traders to make money as long as Quicksilver’s shares rally 9.60% to exceed the average breakeven price of $13.35 by October expiration.

MCCC – Mediacom Communications Corp. – Shares of the firm engaged in the development of cable systems serving smaller U.S. cities are flat on the day at $6.28 in late afternoon trading. MCCC popped onto our ‘hot by options volume’ market scanner earlier in the session after one options investor exchanged a chunk of 4,000 calls on the stock in the October contract. The calls traded to the middle of the market at the October $7.5 strike for a premium of $0.25 apiece. The investor may be buying the contracts, in which case he is bullish on Mediacom and expects shares to rally sharply ahead of expiration in five months time. A long call…
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Bearish Put Butterfly Spread Materializes on Emerging Markets Fund

Today’s tickers: EEM, GE, PXD, STI, VLO, UPS, RF, NWL, HNT & FFIV

EEM – iShares MSCI Emerging Markets Index ETF – A contrarian options trader established a large-volume bearish put butterfly spread in the June contract this afternoon even though shares of the emerging markets exchange-traded fund, which looks for investment results that correlate to the price and yield performance of the MSCI Emerging Markets index (an index designed by MSCI as an equity benchmark for international stock performance), are trading 0.65% higher to $41.47 as of 2:30 pm (ET). The massive pessimistic play yields maximum benefits to its owner if shares of the underlying stock plummet more than 15.50% from the current price to $35.00 by June expiration. The investor enacted the butterfly by purchasing 20,000 puts at the June $31 strike for a premium of $0.24 apiece [wing 1] in conjunction with the purchase of another 20,000 puts at the higher June $39 strike for $1.41 each [wing 2]. Finally, the body of the butterfly spread involved the sale of 40,000 puts at the central June $35 strike for a premium of $0.58 apiece. The net cost of the ‘fly amounts to just $0.49 per contract. Therefore, the bearish player is positioned to reel in maximum potential profits of $3.51 per contract – total net profits of $7.02 million – should shares of the underlying fund slip to $35.00 by expiration day. Shares of the EEM must surrender at least 7% of their current value by June expiration in order for the investor to breakeven at $38.51. The transaction is a very efficient way for this investor to establish a pessimistic stance on the emerging markets fund because maximum potential gains trump maximum possible losses on the position. The parameters of the butterfly spread represent a reward-to-risk ratio of more than 7-to-1.

GE – General Electric Co. – The diverse conglomerate’s shares are standing 0.30% higher on the day at $16.55 with one hour remaining in the trading session. General Electric’s shares have rebounded 6.30% in the past month since dipping to $15.57 on February 12, 2010, but one big options strategist is positioning for continued bullish momentum in the price of the underlying stock through expiration in May. The optimistic investor initiated a large-volume bullish risk reversal play by shedding 20,000 puts at the June $15 strike for an average premium of $0.37 apiece, spread against…
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Sprint Straddle Implies Limited Movement through November for Shares

Today’s tickers: S, VOD, ENER, KFT, FDX, HNT & FXI

S - A sold straddle in the November contract on Sprint today suggests that at least one investor is hoping to see shares settle at $4.00 when options expire in just over two months. The stock has surrendered 1.5% of its value to stand at the current price of $3.75. The short straddle was established at the November 4.0 strike through the sale of 10,000 calls for 40 cents apiece and the sale of 10,000 puts for 60 cents apiece. The gross premium pocketed by the investor amounts to one dollar per contract and is retained in full as long as shares rise to $4.00. The short call and put positions will result in losses for the straddle-seller if shares of Sprint surpass the breakeven point to the upside at $5.00, or if the stock falls beneath the breakeven point to the downside at $3.00, by expiration in November. – Sprint Nextel Corp. –

VOD - The telecommunications company appeared on our ‘hot by options volume’ market scanner after investors used put options to get bullish on the stock in the January contract. VOD received an upgrade to ‘buy’ from ‘hold’ at Investec, which perhaps spurred the more than 2.5% rally in shares during the trading session to $22.66. Traders expecting continued upward momentum in the stock were seen selling approximately 5,300 puts short at the January 22.5 strike price for an average premium of 1.72 apiece. Investors will retain the full amount of premium received if shares of VOD remain higher than $22.50 through expiration. Individuals short the put options bear the risk of having shares of the underlying put to them at an effective price of $20.78. Shares of VOD would be put to the traders if the put options land in-the-money with shares trading beneath $22.50. – Vodafone Group PLC –

ENER - Shares of the energy firm have surged more than 21% during the session to $12.64 prompting bullish call buying action in the front month. Some investors targeted the now in-the-money September 11 strike where 4,000 calls were picked up for an average premium of 61 cents each. Traders holding these call options have already begun to accumulate profits of approximately 1.03 because shares are currently trading above the effective breakeven point on the transaction at $11.61. Nearly 6,000 calls were coveted at the higher September 12.5…
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Smithfield bulls like hogs

Today’s tickers: SFD, LTD, XLF, HNT, AIG, KEY, WMB & CSX

SFD Smithfield Foods, Inc. – Shares of the hog producer, pork processor, and beef processor have surged upwards by 6% to $10.50. Analysts in recent weeks used high feed prices and sluggish sales as reason enough to slash targets on food-producing companies, while there had also been concern on Smithfield’s ability to meet some forthcoming debt covenants. Corn prices have eased from $4.18 to $3.82 per bushel since the start of the month. Pork sales are also sensitive to the economy’s fortunes and sales have eased as consumers switch to cheaper grain-based foodstuffs and so perhaps today’s rally is based on expectations of a return to traditional consumption habits. Option investors crowded into the call-corral hoping that shares would continue to rise through expiration in June. The May 12.5 strike price had more than 7,200 calls purchased for 34 cents per contract while the June 12.5 strike witnessed some 2,300 calls coveted for 89 cents apiece. In order for these calls to land in-the-money, shares would need to continue to climb by another 19% from the current price. Option implied volatility has spiked to 102% from the value recorded at the start of the traded day of 77%.

LTD Limited Brands, Inc. – The specialty retailer of such brands as Victoria’s Secret and Henri Bendel has experienced a share price rally of 2% to stand at $10.88. LTD edged onto our ‘hot by options volume’ market scanner after one investor picked up a hefty chunk of puts in the August contract. Perhaps this bearish investor expects retailers to struggle through the summer months as consumers exchange their rally-caps for thrift-caps. This trader purchased 17,800 puts at the August 10 strike price for a premium of 1.25 per put option. It is possible that this trader is long the stock and is therefore utilizing the put options as downside protection should shares relapse over the next six months. The puts would begin to yield profits if shares were to decline by expiration, beginning at the breakeven share price of $8.75.

XLF Financial Select Sector SPDR – Shares of the financials ETF are slightly higher today by about 0.5% to $10.65. As usual, the fund was one of the top tickers on our ‘most active by options volume’ market scanner. One interesting trade we observed took place in the September…
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Phil's Favorites

Was coronavirus really in Europe in March 2019?

 

Was coronavirus really in Europe in March 2019?

Courtesy of Claire Crossan, Glasgow Caledonian University

The novel coronavirus – SARS-CoV-2 – may have been in Europe for longer than previously thought. Recent studies have suggested that it was circulating in Italy as early as December 2019. More surprisingly, researchers at the University of Barcelona found traces of the virus when testing untreated wastewater samples dated March 12, 2019.

The study was recently published on a preprint server, medRxiv. The paper is currently being subject to critical review by outside experts in preparation for...



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Biotech/COVID-19

Was coronavirus really in Europe in March 2019?

 

Was coronavirus really in Europe in March 2019?

Courtesy of Claire Crossan, Glasgow Caledonian University

The novel coronavirus – SARS-CoV-2 – may have been in Europe for longer than previously thought. Recent studies have suggested that it was circulating in Italy as early as December 2019. More surprisingly, researchers at the University of Barcelona found traces of the virus when testing untreated wastewater samples dated March 12, 2019.

The study was recently published on a preprint server, medRxiv. The paper is currently being subject to critical review by outside experts in preparation for...



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Zero Hedge

The Sinking Titanic's Great Pumps Finally Fail

Courtesy of Charles Hugh Smith, OfTwoMinds blog

The greater fools still partying in the first-class lounge are in denial that even the greatest, most technologically advanced ship can sink.

On April 14, 1912, the liner Titanic, considered unsinkable due to its watertight compartments and other features, struck a glancing blow against a massive iceberg on that moonless, weirdly calm night. In the early hours of April 15, the great ship broke in half and sank, ending the lives of the majorit...



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ValueWalk

These coronavirus stimulus benefits will expire this month

By Aman Jain. Originally published at ValueWalk.

The CARES Act was signed into law on March 27 by President Donald Trump. Along with the stimulus checks, the relief package offered several benefits. Many of these benefits were one-time or came with an expiration date. Let’s take a look at the coronavirus stimulus benefits that are set to expire this month.

Coronavirus stimulus benefits that will expire soon

One of the first benefits of the CARES Act that will expire is the extension to file your taxes. The original deadline to file taxes was April 15. Due to the coronavirus pandemic, the deadline was extended to July 15.

There were reports that this ...



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Chart School

Dow 2020 Crash Watch - Update

Courtesy of Read the Ticker

Like 1929 the markets have bounced. This time it is on the back of the FED $6.5T money printing.

Previous Post: Dow 2020 Crash Watch 

But can the FED blow $6T every time the market rolls down to test support.

Yes, maybe before the US 2020 elections the FED will do 'what it takes'. But post elections not so much, the year 2021 is a long way from the next election (presidential or congress) and defense of the markets may not be so supportive at $6T or $10T per market smash. The FED may hesitate, and that will be window for stocks to break lower.

The 36 month simple moving a...

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Kimble Charting Solutions

Red Hot China Attempting Key Breakout, Says Joe Friday

Courtesy of Chris Kimble

China ETF (FXI) has been “Red Hot” of late? Is it about to run out of steam or will it remain on fire going forward?

This chart of FXI comes from Investors Business Daily and Marketsmith.com. It reflects that FXI is above key long-term moving averages and its RS ratings is moving sharply higher of late.

Line (1) has been support and resistance several times over the past 3-years. The rally of late has FXI ...



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The Technical Traders

Retail Traders & Investors Squeezed to Buy High-Risk Assets Again

Courtesy of Technical Traders

Yes, we certainly live in interesting times.  This, the last segment of our multi-part article on the current Q2 and Q3 2020 US and global economic expectations, as well as current data points, referencing very real ongoing concerns, we urge you to continue using common sense to help protect your assets and families from what we believe will be a very volatile end to 2020.  If you missed the first two segments of this research article, please take a moment to review them before continuing.

On May 24th, 2020, we published this ...



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Lee's Free Thinking

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

 

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

Courtesy of  

The COVID 19 pandemic is, predictably, worsening again in much of the US. Only the Northeast, and to a lesser extent some Midwestern states, have been consistently improving. And that trend could also reverse as those states fully reopen.

The problem in the US seems to be widespread public resistance to recommended practices of social distancing and mask wearing. In countries where these practices have been practi...



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Digital Currencies

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

 

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

App-etising? LDprod

Courtesy of Michael Rogerson, University of Bath and Glenn Parry, University of Surrey

Food supply chains were vulnerable long before the coronavirus pandemic. Recent scandals have ranged from modern slavery ...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

Free, Live Webinar on Stocks, Options and Trading Strategies

TODAY's LIVE webinar on stocks, options and trading strategy is open to all!

Feb. 26, 1pm EST

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Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

This week, we also have a special presentation from Mike Anton of TradeExchange.com. It's a new service that we're excited to be a part of! 

Mike will show off the TradeExchange's new platform which you can try for free.  

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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