JLN Options: Options Traders Unfriend Facebook

Jun 5, 2012

Lead Stories

Options Traders Unfriend Facebook
Betting shifts to further falls from seeking buying opportunities.
Steven M. Sears, Barron’s
Facebook’s future is increasingly dour in the options market. While investors had been viewing a possible drop in the stock as a buying opportunity, now they’re looking to bet on profiting from further declines.
http://jlne.ws/L13cmV
 
Traders set for Korean options hit
Tom Osborn, Financial News
An option on the index of Korea’s top 200 stocks is set to lose its crown as the world’s most traded derivative. Pressure from the South Korean securities regulator to increase the face value of the option fivefold is expected to reduce the volume of trading by the same magnitude, according to a report from the World Federation of Exchanges.
http://jlne.ws/Lljt39 (paywall…need subscription to Financial News to see whole story)

Korean Won Rebounds From 8-Month Low as Stocks Rally; Bonds Drop
Kyoungwha Kim, Bloomberg
South Korea’s won strengthened, rebounding from near an eight-month low, as some investors judged recent declines excessive. Government bonds declined as stocks rallied…
The won climbed 0.2 percent to 1,180.20 per dollar in Seoul, according to data compiled by Bloomberg. Its one-month implied volatility, a measure of exchange-rate swings used to price options, fell 73 basis points, or 0.73 percentage point, to 10.9 percent.
http://jlne.ws/KeTpZn

Exchanges

CBOE Holdings, Inc. To Present At Sandler O’Neill Global Exchange And Brokerage Conference On June 8
Press Release
CBOE Holdings, Inc. (Nasdaq: CBOE) today announced that William J. Brodsky, Chairman and Chief Executive Officer, will present at the Sandler O’Neill Global Exchange and Brokerage Conference in New York, NY, on Friday, June 8, 2012, at 11:00 a.m. Eastern Time. The presentation, to be broadcast live over the Internet, can be accessed at www.cboe.com under Investor Relations, Events and Presentations.  Approximately 24 hours after the live presentation, an audio Webcast will be available for replay at the same address.
http://jlne.ws/LljrrV
** Aside from this and NYSE Euronext (listed just below) there are a wide variety of other presenters at this conference (too many to list here).  Many are offering simulcasts/recordings of their presentations on their respective websites.  If interested visit a presenter’s website to see if they offer a recording of their presentation.  The agenda for the event can be found here (PDF).

NYSE Euronext to Present at the Sandler O’Neill Global Exchange & Brokerage Conference
Press Release
NYSE Euronext (NYX) today announced that Duncan Niederauer, Chief Executive Officer of NYSE Euronext, will present at the Sandler O’Neill Global Exchange & Brokerage Conference at the St. Regis Hotel in New York City on Friday, June 8, 2012 at 11:30 a.m. (ET).
A live webcast of the presentation will be available on NYSE Euronext’s Investor Relations website: http://ir.nyse.com/ .
http://jlne.ws/JJIdCD

Regulation

Senator urges Obama to replace commodities chief
Alexandra Alper, Reuters
A senator called on President Barack Obama on Monday to replace the chairman of the chief derivatives regulatory agency with an official who will crack down more quickly on speculation in oil and other commodities markets.
In a sharply worded letter, Sen. Bernie Sanders, an Independent from Vermont, slammed Commodity Futures Trading Commission Chairman Gary Gensler for not swiftly putting in place position limits, which curb the size of positions that traders can hold in commodities like gold and oil.
http://jlne.ws/LmJsv1

Strategy

Stay Hedged: More Volatility On The Way, Says MKM Partners
Brendan Conway, Barron’s
MKM Partners is sticking to last week’s recommendation: Derivatives strategist Jim Strugger recommends in a note this morning to stay hedged for “imminent” market volatility.
http://jlne.ws/NFesX8

Writing Cover Call Options on Big Oil Could Yield Big Gains
Jonathan Yates, The Motley Fool
While reading romance novels or action thrillers at the beach, writing covered call options on Big Oil companies such as Occidental Petroleum (NYSE: OXY), Chevron Corporation (NYSE: CVX) and Exxon Mobil (NYSE: XOM) could be a profitable way for investors to spend their summer vacations.Writing covered call options entails selling the right to buy shares of a stock you own within a set period of time.  This is transacted through a call option of which the option buyer has the right to buy the underlying stock of the contract at a set price.  On the flip side, the option writer has the obligation to sell the underlying stock at the contract price upon exercise from the option buyer.
http://jlne.ws/KavOxw

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