Blogging Options: CBOE Morning Update 3.27.14

Q4 GDP grew at a 2.6% clip, above the preliminary 2.4% estimate but below the consensus 2.7% to 2.8%. Q3 was plus 4.1%.  Half full or half empty?  Overseas markets mixed to lower.  Basketball resumes, root for your favorite employees (NLRB prelim ruling says D1 athletes employees – send them 1099’s).

Volatility as an asset class

Bank of America (BAC) is up $0.10 to $17.28 in the premarket after receiving approval from the Federal Reserve for its 2014 capital plan. As a result,, B of A will repurchase $4B of its common stock and increase its dividend to 5c from 1c per share. Separately, the bank announced a more than $9B settlement with the Federal Housing Finance Agency related to mortgage-backed securities sold to Fannie (FNMA) and Freddie Mac (FMCC) between 2005 and 2007. Overall option implied volatility of 27 is near its 26-week average of 26.

JPMorgan (JPM) is up 50c to $60.40 after the bank received approval from the Federal Reserve for their proposed 2014 capital plans. The bank plans to boost its quarterly dividend by $0.02 to $0.40 a share and buy back $6.5B. Overall option implied volatility of 21 is at its 26-week average of 21.

Morgan Stanley (MS) is off $0.12 at $31.15, into the bank receiving approval from the Federal Reserve for their proposed 2014 capital plans. The money center announced a $1B program and a doubling of its quarterly dividend to $0.10. Overall option implied volatility of 28 is at its 26-week average.

Citigroup (C) is down $2.78 to $47.45 in the premarket after the Federal Reserve rejected the bank’s capital plan for 2014. Overall option implied volatility of 26 is near its 26-week average of 25.

Options expected to be active @ CBOE: ALU C JPM BAC BP ACN MFFT BBRY FB PLUG

CBOE S&P 500 PutWrite Index (PUT) at 1396.30, above its 10-day MA of 1402.22 and its 50-day moving average of 1379.27. cboe.com/PUT

CBOE S&P 500 BuyWrite Index (BXM) at 1037.08, compared to its 10-day moving average of 1045.66 cboe.com/BXM

CBOE DJIA BuyWrite Index (BXD) at 256.75, compared to its 50-day moving average of 254.57 cboe.com/micro/bxd/

CBOE S&P 500 Short-Term Volatility Index (VXST) at 15.56, compared to its 10-day moving average of 15.65. VXST is a market-based gauge of expectations of 9-day volatility cboe.com/vxst

iPath S&P 500 VIX Short-Term Futures (VXX) is recently down 36c to 44.25 in the premarket.

CBOE Volatility Index (VIX) at 14.93, compared to its 10-day moving average of 15.28 and its 50-day moving average of 15.12 cboe.com/VIX

SPDR S&P 500 ETF Trust (SPY) is recently up 22c to $185.19 after the Fed has approved 25 out of 30 capital return plans from the nation’s largest lenders.

Calls with increasing volume at CBOE:

JCP 4/25/2014 10 17K contracts
VXX 6/21/2014 50 11901
SPY 3/28/2014 187 11K
AAPL 3/28/2014 550 7K
GDX 4/19/2014 24 7K