Different thinking pays of

M

markg_ny

My first post so something I found interesting and hope worth reading for others.

While reading options activity watch I noticed last news about large volume of puts on rarely traded index jpn – amex japan for October strike $140 with bid/ask at close 0.55-0.90 volume 2500 open interest 72.

Then I though, with such a drop in our indexes should japan market follow with not a very nice session. Believe or not but I though about this yesterday.
Not surprisingly today japan went down (index by -$3.6).

100% profit just for thinking about other factors than volatility.

Below the data for October $140 put for jpn:
date price change bid ask volume open interest
10/06/2005 142.16 -3.63 2.00 2.40 27 2572
10/05/2005 145.79 -0.66 0.55 0.90 2500 72

If interested I'll post very interesting (fascinating) samples from last month with much higher profits in 1 to 3 days by those who (I assume) do not know the difference between implied and historical volatility but know better then us.
Mark
 
(ktm , SethArb few words for you at the end).
For the rest:
Some very interesting read (was for me but not written by me) I mentioned above (courtesy of kowal312, word by word, from other forum who mentioned one site (read below) but I double checked few dates he quoted and they claim, they mean OCC to be the largest clearing organization in the world):

This was in Avon thread:
“Last week big news was Avon which unexpectedly lowered guidance and stock went down by -3.60 (12%) on 9/21.
Below is the put call volume for day before the news:
(as always from Option Clearing Corporation OCC site)
date calls puts p/c ratio
9/20/2005 1,990 14,940 7.5
9/19/2005 2,342 2,294 0.97
9/16/2005 620 156 0.25
9/15/2005 3,050 5,600 1.83
9/14/2005 810 1,532 1.89
9/13/2005 2,072 12,394 5.98
9/12/2005 260 2,622 10
9/9/2005 1,162 1,152 0.99
9/8/2005 8,704 5,172 0.59
How did buyers of 14,000 puts know just one day before.”
This I got from stock forum:
“PALMSOURCE INC (psrc) was acquired on 9/9 and price jumped from 10.09 to 17.98 (close to 80%).
Now go to option clearing corporation site:
http://www.optionsclearing.com/market/volume/volbyproduct_form.jsp
(official site where all the clearing of trades takes place) and look at the volumes of calls and puts before the news.
I wrote down the data for the last few days before price jump and it looks like:
date calls puts p/c ratio
9/8/2005 3,964 290 0.07
9/7/2005 2,810 100 0.03
9/6/2005 1,378 300 0.21
9/2/2005 1,362 30 0.02
9/1/2005 3,384 900 0.26
8/31/2005 390 620 1.58
8/30/2005 558 476 0.85
8/29/2005 1,246 330 0.26
8/26/2005 622 842 1.35
8/25/2005 1,082 856 0.79
8/24/2005 752 4 0
8/23/2005 308 0 0
8/22/2005 812 8 0
LOOK AT THE VOLUME OF CALLS!!!!!
What a great strategy someone implemented;-)))))
Just an observation after days/weeks of analyzing options in general I wanted to share.“
This one from sebl and pkz thread
“
As explained in the spread talk forum below are put call volume data for PKZ and SEBL before the news.
As mentioned in PALMSOURCE topic you can find this data at OCC site:
http://www.optionsclearing.com/market/volume/volbyproduct_form.jsp
pkz (on 8/22 it jumped by over $8)
date calls puts p/c ratio
8/22/2005 72,680 9,298 0.12
8/19/2005 25,076 2,154 0.08
8/18/2005 16,796 3,406 0.2
8/17/2005 10,692 2,092 0.19
8/16/2005 33,914 7,806 0.23
8/15/2005 16,888 4,278 0.25
8/12/2005 19,174 5,296 0.27
8/11/2005 28,418 1,650 0.05
8/10/2005 18,978 2,360 0.12
8/9/2005 5,924 920 0.15
8/8/2005 6,568 1,866 0.28
8/5/2005 11,146 2,160 0.19
8/4/2005 4,124 1,386 0.33
8/3/2005 3,936 1,278 0.32
8/2/2005 4,068 1,112 0.27
8/1/2005 6,474 1,854 0.28
SIEBEL SYSTEMS
Oracle on Monday 9/12/2005 said it will buy Siebel.
Look at the volume just trading day before!!!
date calls puts p/c ratio
9/9/2005 146,752 12,542 0.08
9/8/2005 3,522 258 0.07
9/7/2005 10,488 118 0.01
9/6/2005 2,720 940 0.34
9/2/2005 2,996 1,268 0.42
9/1/2005 2,288 480 0.2
8/31/2005 868 86 0.09
8/30/2005 60 70 1.16
8/29/2005 1,062 13,202 12.4
8/26/2005 1,108 1,352 1.22
8/25/2005 13,648 3,328 0.24
Great trades.
“
:) :D ktm , SethArb:
(probably not interesting for others)
- I mentioned that I would post some samples, and while they were not written by me I thought that it was worth sharing it.
- You missed the point of my original post (read it one more time): it was not about the volume but about an idea someone had and the way someone apparently thought in a big picture.
- I read a lot of forums, news etc. and I would be glad if someone posts interesting ideas, events, etc. from other places here.
- I post/reply occasionally, here and there, but I have never ever written anything that would be personal or a waste of time for others to read, I occasionally mention some sites with options news (well known): yahoo-dragon, Schaeffer's Daily Market Blog, ., options articles from thestreet, etc.
- Paid service for options – nothing disgusts me more (paid once) and I have never ever (as opposed to SethArb above :D ) and will never mention any of paid options services.
:) :D
 
Just a word of caution:

5,000 bear call credit spreads will result in 10,000 call volume. Same for 10,000 straight SHORT calls.

I don't know how these web advisories scrutinize the data but to make sure you are on the right side you need to analyze:

- how volume and openint is distributed over different strikes and expirations
- intraday bid/ask/trade data to the determine long or short.

Of course a "knowledgeable investor" will prefer simple long positions but you cannot read this from only total volume. Also as more of them are hauled off to jail they will possibly be forced into more complex positions, divided among different co-conspirators. :)
 
Quote from nonprophet:

Just a word of caution:

5,000 bear call credit spreads will result in 10,000 call volume. Same for 10,000 straight SHORT calls.

I don't know how these web advisories scrutinize the data but to make sure you are on the right side you need to analyze:

- how volume and openint is distributed over different strikes and expirations
- intraday bid/ask/trade data to the determine long or short.

Of course a "knowledgeable investor" will prefer simple long positions but you cannot read this from only total volume. Also as more of them are hauled off to jail they will possibly be forced into more complex positions, divided among different co-conspirators. :)
More...

what about 10000 out of money calls bought on the ask with couple of days before exp ?
 
Quote from markg_ny:

My first post so something I found interesting and hope worth reading for others.

While reading options activity watch I noticed last news about large volume of puts on rarely traded index jpn – amex japan for October strike $140 with bid/ask at close 0.55-0.90 volume 2500 open interest 72.

Then I though, with such a drop in our indexes should japan market follow with not a very nice session. Believe or not but I though about this yesterday.
Not surprisingly today japan went down (index by -$3.6).

100% profit just for thinking about other factors than volatility.

Below the data for October $140 put for jpn:
date price change bid ask volume open interest
10/06/2005 142.16 -3.63 2.00 2.40 27 2572
10/05/2005 145.79 -0.66 0.55 0.90 2500 72

If interested I'll post very interesting (fascinating) samples from last month with much higher profits in 1 to 3 days by those who (I assume) do not know the difference between implied and historical volatility but know better then us.
Mark
More...


Sounds interesting, I will pass it onto a friend of mine who is a M/M in the options game ,(will let you know what he says)

(ring( (ring)

Hello, john (yada yada yada)


(WHAT)


John says (I would not touch it with yours)


sorry (markg ny )NO-GO John says you are full of shit
 

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