Smaller Options Plays Get Some Sun on a Postexpirations Friday
On a clear day, you can see the oddest things.
With volume thin and lots of options investors on vacation or scrambling to deal with more multiple listings, small options plays overlooked in the heat of last week's expiration are popping up like palm trees in the snow.
| |||||||||
| |||||||||
Listings Update
Now we return to the multiple-listings war. We checked out the spreads in Tellabs (TLAB) and Microsoft (MSFT) options, both of which were listed Friday morning by the CBOE. Previously, those were exclusive listings of the Pacific Stock Exchange, which so far has declared neutrality in the options war. The Pacific declined to comment Friday after the CBOE said it would list 29 more Pacific- and Philadelphia Stock Exchange-listed options. Of the CBOE's 29 new options, 16 currently are exclusively listed on the PCX and the other 13 are offered only by the PHLX. War rages on: The Philadelphia exchange on Thursday raided seven of the CBOE's proprietary listings, including heavy traders Hewlett-Packard (HWP), Merck (MRK) and Texas Instruments (TXN). As the battle for volume raged on, price spreads on Tellabs options narrowed almost immediately Friday morning. On Thursday, the spreads ranged from 3/8 to 1/2 on the September and October options, but after the CBOE said it would come onstream with a listing, the spreads -- the difference between the bid price and the ask price for the option -- narrowed to 1/4 or an 1/8. "We hoped [another exchange listing] wouldn't happen so soon," said John Oppenheimer, the Pacific's lead market maker for Tellabs. "But I'm sure the Pacific will respond at some level. ... By the end of the day, the doors will be blown off completely." The Pacific has a dilemma. "If they were smart, the Pacific would drag in the Amex to this battle," said one options veteran. "Why not? They want to add to the mix, so they water down the competition. All they do is pick off the leftovers anyway. Get the Amex and CBOE into a fray, the P-Coast can stand on the sides after they list the Amex options to see what the CBOE would do. They want to survive by having them kill each other." The CBOE has already listed Dell (DELL). The following are the options the CBOE said it would begin trading Sept. 1: The 15 current PCX options listings the CBOE will add include: Compaq (CPQ); Sun Microsystems (SUNW); 3Com (COMS); Applied Materials (AMAT); Advanced Micro Devices (AMD); Tellabs; Schering-Plough (SGP); McKessonHBOC (MCK); Alza (ALZA); R&B Falcon (FLC); First Union (FTU); Nike (NKE); Newbridge Networks (NN); Data General (DG); and Baker Hughes (BHI). The 13 additional PHLX listings the CBOE will offer are Home Depot (HD); Time Warner (TWX); Fannie Mae (FNM); Abbott Laboratories (ABT); J.P. Morgan (JPM); Rite Aid (RAD); Newmont Mining (NEM); IDT (IDTI); Analog Devices (ADI); Cambridge Technology Partners (CATP); General Instrument (GIC); Comcast Class A (CMCSA); and Sprint (FON).>To order reprints of this article, click here: ReprintsTheStreet Premium Services For Personal Service: 877-471-2967
Jim Cramer's Action Alerts PLUS:
Trade right alongside a Wall Street pro — enjoy access to his Charitable Trust portfolio and be sent trade alerts BEFORE he makes a move. Learn MoreETF Profits:
Get money-making ideas from the hottest investment vehicle on the planet. Our experts show you how to play various ETF sectors to help pump-up your portfolio. Learn MoreOptionsProfits:
Get 50+ trade ideas a week from the industry's top options experts. Plus — exclusive commentary on market trends and essential trading tools. Learn MoreReal Money:
Our team of professional Wall Street Pros — including Jim Cramer, Doug Kass, and Nicholas Vardy — delivers intelligent analysis, timely trade ideas, and colorful commentary. Learn MoreStocks Under $10:
Break into the market with small- and mid-cap stocks... all $10 or less! David Peltier tells you exactly which low-priced stocks he's buying and selling. Learn MoreTo begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
blog comments powered by Disqus
| Dow Jones | S&P 500 | NASDAQ | 10-Year Note | |
|---|---|---|---|---|
| 12,890.46 | 1,351.95 | 2,927.23 | 20.47 |
Oil *
118.75
|
|
UP
6.51 |
UP
1.99 |
UP
11.37 |
UP
0.72 |
10 Yr
2.05%
SPDR Gold
168.02
|
|
+0.05%
|
+0.15%
|
+0.39%
|
+3.65%
|
Data delayed 20 minutes |

Connect with TheStreet