Option Activity for Friday, May 28, 2010



Members of S.O.M.E. have made the most of the movements within the following companies to capitalize on the options.


ATP Oil and Gas (ATPG)

ATP Oil and Gas (ATPG) options volume is running 4 times the usual, with 49,000 contracts traded and put activity representing about 70 percent of the activity.





Origin Agritech Ltd (SEED)

Origin Agritech (SEED) is bucking the bearish trend. Shares are up $1.19 to $9.28 after Charden raised the stock to Buy and said that $30 to $35 million of cash from a recent sale of its stake in a cotton and seed producer will give SEED an edge over its competitors. In options action, volume is 4 times the average daily. 5,460 calls and 515 puts traded. Looks like buyers driving trading in June and July 10 calls. Possible premium sellers in June 8 and 9 call options. Implied volatility is down 5.5 percent to 69.





CBOE Volatility Index (VIX)

Volatility in the euro is once again spilling over into the US equity market. The European currency, which had recaptured the 1.24 handle early Friday, has recently plummeted back to 1.23 against the dollar after Fitch downgraded the credit rating of Spain. The news triggered a volatile reaction in the equity market and the CBOE Volatility Index (.VIX) rallied 3.22 points to 32.90 and is at session highs. Noteworthy trades in VIX Friday included June 25 – 35 bullish risk-reversals, which traded at $1.10, $1.20, and $1.30 in morning action. 64,000 calls and 72,000 puts traded total.





Baker Hughes Inc (BHI) Baker Hughes (BHI) is down $2.68 to $38.41 and falling to multi-month lows after the Obama administration order the halt of deepwater drilling in the Gulf of Mexico. Yet, in the options, bullish flow detected in Baker Hughes, with 9772 calls trading, or 3 times the recent average daily call volume in the name.

Jun 40 calls are the most actives. 5,360 traded (94 percent Ask). Another 1093 June 38 calls changed hands (93 percent Ask). Volume exceeds open interest in both contracts and ISEE data (88 percent) is also consistent with opening customer buyers.



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