Blogging Options: CBOE Morning Update

Volatility as an asset class

Lufkin (LUFK) is up $24.07 to $88.00 after the energy service company announced a joint agreement whereby GE (GE) will acquire the company for approximately $3.3B.   Overall option implied volatility of 36 is below its 26-week average of 40.

Safeway’s (SWY) is trading at $25, up $0.08 as the retailer is expecting its Blackhawk Network to sell 10M shares at $20-$22 per share. Overall option implied volatility of 31 is below its 26-week average of 33.

Google (GOOG) is down $9.00 to $774.05 in the premarket on the search company may be in the negotiating phase of acquiring WhatsApp for $1B, reports DigitalTrends.com. Overall option implied volatility of 25 compares to its 26-week average of 24.

Options expected to be active on open; AA JPM WFC GE GOOG LUFK

CBOE S&P 500 BuyWrite Index (BXM) closed at $942.17; above its 10-day moving average of 942.62 and above its 50-day moving average of 931.34. www.cboe.com/BXM

CBOE Volatility Index (VIX) closed at 13.92, and is now at 14.37, up 0.45. That is above its 10-day moving average of 13.43, and its 50-day moving average of 13.54. www.cboe.com/VIX.

SPDR S&P 500 ETF Trust (SPY) is recently up 34c to $155.48 in the premarket  as Japanese and European stocks rally.

Calls with increasing volume at CBOE:
SPY 4/5/2013 155 63K
SU 5/18/2013 32 16K
BAC 4/20/2013 12 10K
AAPL 4/5/2013 425 9K
MNKD 5/18/2013 4 8K

Alcoa kicks off earnings season after the close today.  10-year ay 1.72%, Ag’s higher at the opening.