And what was particularly painful to me was Sunoco (SUN - commentary - Cramer's Take), whose IV rose up 12% as the stock fell over $3, or 5%, on the day. I had been away for
the past two weeks and spent most of Sunday scouring for a new trade for the Option Alert model portfolio. I ended up buying Sunoco call options on Monday morning only to see it become one of the worst performers of the day. That's the classic "Welcome Back," I'm-still-the-boss slap in the face that Mr. Market delivered to me.
Volatility decliners were led by "deal" issues: IV in Biomet (BMET - commentary - Cramer's Take) tumbled down 67% on news it was being acquired for $10.9 billion by a private-investor group. Harrah's (HET - commentary - Cramer's Take) IV sank down 43% even as it looks like its board might reject an increased $86-per-share bid for the casino operator.
P.S. Will you be there when Cramer makes his next move?
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Steven Smith Blog Year-End Options Conundrum 12/18/2006 10:41 AM EST In a tough time of year for contracts, try starting a calendar spread.
Steven Smith Blog See You Soon 11/29/2006 8:10 AM EST Here's where Steve will be for the next week or two.
Steven Smith Blog Looking at LEAPs Strategy 11/28/2006 3:30 PM EST One reader wonders how to handle his holdings now.
Steven Smith writes regularly for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks. He also doesn't invest in hedge funds or other private investment partnerships. He was a seatholding member of the Chicago Board of Trade (CBOT) and the Chicago Board Options Exchange (CBOE) from May 1989 to August 1995. During that six-year period, he traded multiple markets for his own personal account and acted as an executing broker for third-party accounts. He appreciates your feedback; click here to send him an email.To read more of Steve Smith's options ideas take a free trial to TheStreet.com Options Alerts.
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