Friday, December 3, 2010

Boyd Gaming (BYD) - Calls Active, Skew Turns on Short Stock Interest

BYD is trading $9.73, up 5.8% with IV30™ up 11.5%. The LIVEVOL™ Pro Summary is below.

On Nov. 15th Bloomberg released a list of the stocks with "TOP 25 INCREASES IN SHORT INTEREST VS FLOAT." BYD was on it, with 31.80% total short interest as of that date.

The company has traded 7,800 contracts on total daily average option volume of just 1,670. Calls have traded on a 38:1 ratio to puts, with the Jan 10 calls trading more than 5,700x. The Stats Tab and Day's biggest trades snapshots are included (below).

The Options Tab (below) illustrates that the calls are mostly opening (compare OI to trade size). The orders look like purchases, note that Jan vol is up 7 points while Dec is up 5.2 and Mar is up 1.6.

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

We can see the upside skew is bid for both the front two months. The call buying order flow has pushed vol.

Finally, the Charts Tab (6 months) is below. The top portion is the stock price, the bottom is the vol (IV30™ - red vs HV20™ - blue vs HV180™ - pink).

We can see how the IV30™ is just now crossing passed the HV20™ and HV180™. Or, in English, the short term implied has passed the short-term realized vol and the long-term realized.

This is trade analysis, not a recommendation.

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