The Need for SEED

• Posted by Adam Warner
• on November 25th, 2009

Some interesting volume amidst a slow day, via Cuttone and Company.

US Airways Group, Inc. (LCC),  someone is expecting some serious upside as the January 4 calls were in demand. Over 13,000 contracts traded on the day.

 Origin Agritech Limited (SEED) has doubled over the past week and yet today call buyers were looking for more. The December 10 calls traded over 10,000 contracts. Not to be outdone,  the December 12.5 line traded over 23,000 x with an open interest of 496.

Indeed, was quite a week for weed (Tim Lincecom, Rickey Williams) and SEED. And quite a week for options volatility here as one would expect. 30 Day IV jumped from 75 to 127. Spec. buyers in these calls are terrified shorts? Probably a bit of both.

So what do you do in here? Nothing like a low priced stock with exploding volatility. The Dec. 10 straddle goes for $2.70, the Dec. 7.5/12.5 strangle for a little under $1. I know I can’t buy something like that, going to resist the temptation to sell it though.

 

 

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