XRX is trading $9.54 with IV30™ up 1.3%. <img src="http://4.bp.blogspot.com/_hMry1m7UF10/TE8aw0lr-SI/AAAAAAAADxo/XUVw5bMg4V4/s1600/xrx_summary.gif"> The company has traded over 40,000 options on total daily average option volume of just 8,680. 30,000 contracts traded in one trade; a Sep 9/10 risk reversal (sell puts/buy calls) on a 67 delta against $9.65 stock. The Stats Tab and Day's biggest trades snapshots are included (<a href="http://livevol.blogspot.com/2010/07/xrx.html">in the article</a>). The Options Tab (<a href="http://livevol.blogspot.com/2010/07/xrx.html">in the article</a>) illustrates that both the calls and the puts are opening (volume >> OI). <b>Trade Stats</b> Sell 15,000 Sep 9 puts @ $0.25 Buy 15,000 Sep 10 calls for $0.35 Sell 99,164 XRX shares at $9.65 The PnL chart is included (<a href="http://livevol.blogspot.com/2010/07/xrx.html">in the article</a>). This trade creates a net debit of $150,000. At expiration it makes money above $10.13. Max loss to the downside is -$12,693,067 (i.e. if the stock goes to $0). The 52 wk range for XRX is [$7.19,$11.72]. The PnL at those levels is: PnL($7.19) = -$2,621,057 PnL($11.72) = $2,224,731 The Skew Tab snap (<a href="http://livevol.blogspot.com/2010/07/xrx.html">in the article</a>) illustrates the vols by strike by month. This is sort of the Rodney Dangerfield of skews; "No respect." You can see The front three months have almost identical skews and there is no bend upward for the 10 strike purchases or a significant bend downward for the 9 strike sales. Finally, the Charts Tab (6 months) is below (<a href="http://livevol.blogspot.com/2010/07/xrx.html">in the article</a>). The top portion is the stock price, the bottom is the vol (IV30™ - red vs HV20™ - blue). The yellow shaded area at the very bottom is the IV30™ vs. the HV20™ vol difference. We can see the HV20™ is now well above the IV30™ as XRX stock has rebounded hard from its low a month ago. The next earnings cycle is projected for Oct (or even Nov), so this trade does not worry about that. If you're looking to get long XRX with the order flow (and the stock chart), maybe a Sep 10 call purchase with a Sep 8 put sale and a Sep 11 cale sale makes more sense than this risky. Cost of that trade is about $0.12 for a max gain of $1 and no downside risk until the stock gets to the $8.12 level and no short stock worries. This is trade analysis, not a recommendation. Details, trades, prices, vols, skews, charts here: http://livevol.blogspot.com/2010/07/xrx.html