Tuesday, April 19, 2011

Coeur d'Alene Mones (CDE) - Rising Vol, Rising Skew, Dipping Stock

CDE is trading $30.80, up 0.6% with IV30™ down 2.4%. The LIVEVOL® Pro Summary is below.


For a limited time we are offering a FREE real-time trial to Livevol® Pro Click for Free Trial Offer

Coeur d’Alene Mines Corporation (Coeur) is a silver producer with gold assets located in North America. The Company, through its subsidiaries, is engaged in the operation, ownership, development and exploration of silver and gold mining properties and companies located primarily within South America (Chile, Argentina and Bolivia), Mexico (Chihuahua), United States (Nevada and Alaska) and Australia (New South Wales).

This stock has some interesting vol phenomena coming into earnings. Let's start with the Charts Tab. The top portion is the stock price, the bottom is the vol (IV30™ - red vs HV20 - blue vs HV180 - pink).

We can see the stock has dipped pretty sharply of late while the IV30™ has spiked. Last earnings cycle, the ATM straddle rose to ~53 vol. The options montage on 2-25-2011 close is included below (CDE closed $27.65).

The following day the stock gapped up more than $4 on the earnings release. Looking to the Options Tab as of today (below), we can see the ATM vol is just under 60, with a few weeks to go before earnings.

So, in English, the vol is higher today with a few weeks to go before earnings than it was the day of earnings on the last cycle. It's pretty obvious that the option market reflects elevated risk.  The Skew Tab also shows some cool vol.

We can see the upside is bid as the skew bends higher to the OTM calls. There's also an interesting bump in the May 38 call vol which is over 62 vol. I posted an article to TheStreet.com on CDE, so no specific trade analysis, but there's a lot going on here -- very cool vol to examine.

This is trade analysis, not a recommendation.

Follow Live Trades and Order Flow on Twitter: @Livevol_Pro

Legal Stuff:

No comments:

Post a Comment