Fed Move Slices into Options Prices, At Least for Today

The Fed's dramatic 50 basis point cut in interest rates not only added some rocket fuel to the stock market, it may have brought some relief to options traders who had been besieged by high prices as a result of unusually high volatility. How long it lasts is the big question.

Today's Coverage

Nasdaq Soars on Rate-Cut Euphoria

Fed Move Slices into Options Prices, At Least for Today

Why Did the Fed Cut Rates Today?

Long End of Treasury Market Battered Following Rate Cut

Fed Scorecard

Pulse: Giddy Tech Investors Give Life to Beaten Up Chip Stocks

Before today's rate cut, the Chicago Board Options Exchange Volatility Index had been trending toward the mid-30 level, an area that brought high prices for most options contracts. On Tuesday, the VIX closed at 34.20, but it fell to 28.61 in the wake of the Fed move, a decrease of roughly 16% in the course of slightly more than an hour. ...