JLN Options: July 6, 2012: VIX Pops On Europe Fear, Bad Data

Jul 6, 2012

Lead Stories

VIX Pops On Europe Fear, Bad Data
After recent sharp declines, VIX popped today on renewed fear over Europe and bad economic data in the United States
VIX, the CBOE Volatility Index, also known as the “fear indicator,” declined sharply in June from approximately 26-27 down into the mid 17s by the end of the month.
http://jlne.ws/OBUVsw

OptionMonster Sonar Volatility Report: Buying Upside Skew

Exchanges

TMX should be acquiring, experts say
Firm could potentially bid for London stock exchange group
By Doug Alexander And Sean B. Pasternak, Bloomberg News July 6, 2012
TMX Group Inc., owner of the Toronto Stock Exchange, should seek takeovers of global competitors such as CBOE Holdings Inc. after its $3.73-billion sale to a Canadian investor group cleared its biggest regulatory hurdles, investor Thomas Caldwell said.
“You’re effectively the dominant exchange in Canada,” said Caldwell, chairman and chief executive officer of Toronto-based Caldwell Securities Ltd., and who owns shares in TMX and CBOE “I think you can go hunting, whether it be a CBOE or taking a swing at London.”
http://jlne.ws/OBW834

OPTIONS ON FUTURES

Oil Options Volatility Falls as Futures Drop on Jobs
By Barbara Powell on July 06, 2012
Crude-oil options volatility fell as underlying futures dropped as much as 3.4 percent after a report that U.S. employers added fewer workers than projected in June.
Implied volatility for at-the-money options expiring in August, a measure of expected price swings in futures and a gauge of options prices, was 32.4 percent at 1:25 p.m. on the New York Mercantile Exchange, down from 34.5 percent yesterday.
http://jlne.ws/OBSaHH

Strategy

4 ETFs to Guard Against Market Volatility
In today’s wild market, these low-beta picks can calm your portfolio
By Susan J. Aluise, Aviation, Auto & Transportation Writer, InvestorPlace
Whenever the topic turns to market volatility — and its impact on investors’ portfolios — I’m reminded of a simple, but powerful, metaphor from PIMCO CEO Mohamed El-Erian. “Think of the image of a car on a bumpy road to an uncertain destination that has already used up its spare tire,” he said. “The cash reserves of people have been eaten up by the recent market volatility.”
http://jlne.ws/OBXk6G

Trading volatility ahead of big events
By Option Monster, July 6th, 2012
The best time to trade is when your outlook is different from the consensus. And when it comes to options, that outlook must include volatility data, which can often be the best source of profit.
I saw just such an opportunity as we headed into the European Union summit. The volatility being priced in didn’t seem to be appropriate for what could have emerged from the event.
http://jlne.ws/OC3ovM

Events

Interactive Brokers Group to Host Second Quarter Earnings Conference Call
July 05, 2012 11:33 AM Eastern Daylight Time
GREENWICH, Conn.–(BUSINESS WIRE)–Interactive Brokers Group, Inc. (NASDAQ GS: IBKR) plans to announce its second quarter 2012 financial results on Tuesday, July 17, 2012, in a release that will be issued at approximately 4:00 pm (ET). The press release will also be available on the company’s web site, www.interactivebrokers.com/ir.
A conference call to discuss the company’s results will be held at 4:30 pm (ET) on that day, July 17.
http://jlne.ws/OC29wD

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