Daily Biotech Small & Micro Cap Update

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The Ophir Gottlieb Small Cap Biotech Index
Is this the biotech revolution or the biotech bust?



231 small / micro cap biotech and pharma companies (equal weighted):

• Public Biotech and Pharma Companies
• Trade on North American Exchanges
• Market Cap Range: [$0, $2 Billion]
• Price, Employees, Revenue Range: Any

More on index construction and performance: The Ophir Gottlieb Small Cap Biotech Index

Today's Biotech Index Stock Movers



Today's Biotech Index Unusual Option Volume



Full Index Constituents and Moves




This is trade analysis, not a recommendation.

Follow @OphirGottlieb

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Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

Today's Top Headlines

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Provided by Livevol(R)

Top Headlines
* PwC is sued for $1 billion over MF Global collapse

* We're in a private debt crisis that could lead to the next economic collapse: Richard Vague

* Wall Street ends higher but biotech selloff weighs

* GM adds 971,000 cars to ignition switch recall

* Nasdaq’s weekly loss is worst since October 2012

* Fleeing investors create biggest outflows from biotech/health care in 3 years

* Why an ETF might not be your cheapest choice

* Putin, Obama discuss U.S. Ukraine proposal

* Ugly inflation report for Fed but no game-changer, economists say

* S&P Cuts Target To A from A+

* U.S. Two-Year Note ‘Oversold’ in Response to Yellen Rate Outlook

* High-frequency trading hurts regular customers, Michael Lewis tells ’60 Minutes’



Top option Story
* Interpublic Group (IPG) - Massive Earnings Bet Comes into Play

Biotech Index
* Daily Biotech Small & Micro Cap Update

Market Overview

Largest Stock Gainers



Largest Stock Losers



New 52 Wk Highs in S&P 500



New 52 Wk Lows in S&P 500
No New Lows


Unusual Option Volume



Elevated Implied Volatility (IV) to Historical Volatility (HV)



This is trade analysis, not a recommendation.

Follow @OphirGottlieb

Tweet


Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

03-28-14: End of Day Report - Largest Stock Moves, New 52 Wk. Highs/Lows, Unusual Option Volume

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Provided by Livevol(R)

Top Headlines
* PwC is sued for $1 billion over MF Global collapse

* We're in a private debt crisis that could lead to the next economic collapse: Richard Vague

* Wall Street ends higher but biotech selloff weighs

* GM adds 971,000 cars to ignition switch recall

* Nasdaq’s weekly loss is worst since October 2012

* Fleeing investors create biggest outflows from biotech/health care in 3 years

* Why an ETF might not be your cheapest choice

* Putin, Obama discuss U.S. Ukraine proposal

* Ugly inflation report for Fed but no game-changer, economists say

* S&P Cuts Target To A from A+

* U.S. Two-Year Note ‘Oversold’ in Response to Yellen Rate Outlook

* High-frequency trading hurts regular customers, Michael Lewis tells ’60 Minutes’



Top option Story
* Interpublic Group (IPG) - Massive Earnings Bet Comes into Play

Biotech Index
* Daily Biotech Small & Micro Cap Update

Market Overview

Largest Stock Gainers



Largest Stock Losers



New 52 Wk Highs in S&P 500



New 52 Wk Lows in S&P 500
No New Lows


Unusual Option Volume



Elevated Implied Volatility (IV) to Historical Volatility (HV)



This is trade analysis, not a recommendation.

Follow @OphirGottlieb

Tweet


Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

Daily Biotech Small & Micro Cap Update

Tweet

The Ophir Gottlieb Small Cap Biotech Index
Is this the biotech revolution or the biotech bust?



231 small / micro cap biotech and pharma companies (equal weighted):

• Public Biotech and Pharma Companies
• Trade on North American Exchanges
• Market Cap Range: [$0, $2 Billion]
• Price, Employees, Revenue Range: Any

More on index construction and performance: The Ophir Gottlieb Small Cap Biotech Index

Today's Biotech Index Stock Movers



Today's Biotech Index Unusual Option Volume



Full Index Constituents and Moves




This is trade analysis, not a recommendation.

Follow @OphirGottlieb

Tweet


Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

Interpublic Group (IPG) - Massive Earnings Bet Comes into Play

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IPG is trading $16.95, up 1.1% with IV30™ up 13.6%. The Symbol Summary is included below.

Provided by Livevol

The Interpublic Group of Companies, Inc. (Interpublic) is a global advertising and marketing services companies.

This is an order flow note, specifically what appears to be an earnings bet to the upside.  Let's turn to the Stats Tab, below.

Provided by Livevol

We can see that 9,769 calls have already traded today on a total daily average of just 232.  Even more interesting is how concentrated the trading is.  Also note that the total open interest right now is 13,509 and if these are all opening positions, the OI will pop ~70%.  So, in English, this is a huge position for this stock.

The Options Tab is included below.

Provided by Livevol

We can see that more than 8,300 of the contracts traded were in the May 18 calls on zero existing open interest.  From what I can tell these are substantially purchases and I don't see a lot of hedging going on (stock volume is ~2.9 million shares on average of ~3.9 million shares).  This looks like naked call buying -- of course it could be a hedge against a short position.

The Charts Tab (two-years) is below. The top portion is the stock price, the bottom is the vol (IV30™ - red vs HV20™ - blue vs HV180™ - pink).

Provided by Livevol

We can see a nice stock appreciation from ~$10 to now over $17. The all-time high for IPG is over $50.  Let's turn to the volatility chart, below.

Provided by Livevol

The vol is low(ish) but has seen a substantial pop of nearly 40% in the last month.  A part of that is due to approaching earnings, but not all of it.  The risk is simply increasing per the option market and it appears to be a reaction to the turn in the stock price off of it's multi-year highs.

The Skew Tab snap (below) illustrates the vols by strike by month.

Provided by Livevol

This is an interesting image -- we can see how the skew has bent upwards where the out-of-the-money (OTM0 calls are now priced to higher volatility than the at-the-money (ATM) options.  In the general sense this would be considered "abnormal" skew, but it's a great illustration of how order flow affects skew in real-time.

To read more about skew, what is and why it exists you can click the title below:
Understanding Option Skew -- What it is and Why it Exists.

There's a little ambiguity about the exact date of the earnings release which happens to be right around Apr options expiry.  My best guess is that this is a speculative bet on that earnings release.

This is trade analysis, not a recommendation.

Follow @OphirGottlieb

Tweet


Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

03-28-2014 - Midday Report

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Headlines
*Fleeing investors create biggest outflows from biotech/health care in 3 years: B. of A. Merrill Lynch

*We're in a private debt crisis that could lead to the next economic collapse: Richard Vague

Market Snapshot

Stock Gainers



Stock Losers



Intraday New 52 Wk Highs in S&P 500



Intraday New 52 Wk Lows in S&P 500
No New Lows


Unusual Option Volume



This is trade analysis, not a recommendation.

Follow @OphirGottlieb

Tweet


Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.