FYI - Volatility Expansion

Discussion in 'Options' started by donnap, Mar 18, 2008.

  1. donnap

    donnap

    BSC March 5P for .45 with BSC @ 5.40 IV =300-400

    With BSC @ 6.90 puts are the same price .40x.45 IV=600+

    I'm amazed, anyways.
     
  2. why are you amazed? this could gap up and down 50% easily (well down mostly) daily. So the options are priced as such.

    There were a lot of talk, but i still dont think anyone has a clue why it went up to $6 except the insiders who bought it.
     
  3. there might also have been a lot of people that were short the stock and long the bonds that were closing their position