optionvol-NBC-Bay-Area

BBRY is trading $10.50, up 7.6% with IV30™ up 10.9%. The LIVEVOL® Pro Summary is below.



BlackBerry Limited, formerly Research In Motion Limited, is a designer, manufacturer, and marketer of wireless solutions for the worldwide mobile communications market.

I found this stock using a real-time custom scan. This one hunts for vol gainers on the day. But this is actually a depressed vol note relative to a stock snapping up.

Custom Scan Details
Stock Price GTE $5
IV30™ GTE 30
IV30™ Percent Change GTE 10
Average Option Volume GTE 1,200
IV30™ Change GTE 7

The two-year BBRY Charts Tab is included (below). The top portion is the stock price the bottom is the vol (IV30™ - red vs HV20™ - blue vs HV180™ - pink).



So the stock story for BBRY (formerly RIMM) is not good… This was a $140+ stock a few years ago and the rage of new technology. Then it fell to nearly $5 with the risk of obsolescence looming in a very non-trivial way. Then there was the great hope of BBRY v10. That hope has sort of kept the firm going – they are rich with cash, not necessarily rich with product.

But this is a vol story, so let’s turn to a one-year IV30™ chart in isolation below.



We can see that just about a week ago the implied hit an annual low as it drifted down post earnings. But, we can also see a rather abrupt reversal, where the implied has now popped. In the meantime, the stock has gone from ~$8.60 to now ~ $10.50, so a ~25% rise in two weeks. It’s that move in stock with the level of the implied (which even after the recent pop is still in the 24th percentile on an annual measure) that caught my attention. In a sense, it feels like BBRY is back in play – not good or bad, just back to the realm of the unknown. Unknown = risk = higher vol.

Let’s look at the Skew Tab, below.



Even though Aug expiry is in five days, the skew shape in Aug is still noteworthy. We can see substantial upside skew reflecting upside risk (potential) in the immediate-term. The 8.0% rise today in stock is circumstantial evidence that the newly found upside skew risk is in fact an accurate reflection of risk.

Finally, let's look to the Options Tab (below).



Across the top we can see the monthly vols are priced to 68.80% for Aug and 61.32% for Sep. I dunno, that Sep vol feels awfully low given both a myopic view of BBRY and a more evergreen view of the market in general. Ya know, or not…

This is trade analysis, not a recommendation.

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Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

HPQ closed Thursday trading at $26.87, up 0.7% with IV30™ popping up 16.7%. The LIVEVOL® Pro Summary is below.



Hewlett-Packard Company (HP) is a provider of products, technologies, software, solutions and services to individual consumers, small- and medium-sized businesses (SMBs) and large enterprises, including customers in the Government, health and education sectors.

I found this stock using a real-time custom scan. This one hunts for elevated vols. Now HPQ has earnings due out on 8-21-2013 (AMC), but it has already breached an annual high in IV30™ and we still have two weeks to go before earnings. All this in the face of a VIX spot at 12.73%... Weird…


Custom Scan Details
Stock Price GTE $5
IV30™ GTE 30
IV30™ Percentile GTE 80
Average Option Volume GTE 1,200

The one-year HPQ Charts Tab is included (below). The top portion is the stock price the bottom is the vol (IV30™ - red vs HV20™ - blue vs HV180™ - pink).



On the stock side I see quite noticeably that each of the last four earnings cycles (the blue ‘E’ icon represents earnings) have produced a stock gap. Oddly, the first two were down and the last two were up. The earnings release on 11-20-2012 pushed the stock to an annual low of $11.11. Since then the stock has risen 150% -- so, it’s been an impressive turnaround.

But it’s the volatility that caught my eye, so let’s turn to the one-year IV30™ chart, below.



We can see the spikes from the prior earnings cycles (again, look at the blue ‘E’ icons). But now look at the current vol – it has eclipsed those prior highs and we have quite some time before the earnings announcement. My best guess is that the volatility is elevating so early and so much due to the behavior of stock for the last several earnings reports as well as the meteoric climb since 11-20-2013. In this case, a rising vol to a new high well ahead of earnings does make sense.

Finally, let's look to the Options Tab (below).



Across the top we can see that Aug monthly vol is priced to 30.73% while Sep vol (with earnings) is priced to 48.83%. The risk in HPQ is elevating quickly and to new annual highs and given the realities of the stock price movement from recent earnings cycles, I get it… Let’s watch this one into and out of earnings…

This is trade analysis, not a recommendation.

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Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

TSLA is trading $156.83, up 16.8% with IV30™ down 32.8%. The LIVEVOL® Pro Summary is below.



Tesla Motors, Inc. (Tesla) designs, develops, manufactures and sells electric vehicles and advanced electric vehicle powertrain components.

So there's a lot to say about TSLA. The most pressing is the stock and vol move today off of a blowout earnings report. Interestingly, while all of Wall St. seems to have missed the sales projections, somehow I didn't, and all I did was walk in to a dealership for 10 minutes and speak to a salesman. More on that in a sec... You'll want to read it, trust me...

But first, I did a three-piece story on TSLA recently and have included the links to those three articles below (click on the bolded title to read). You can also see the stock price and volatility levels at the time of those articles.

5-9-2013: Tesla (TSLA) - Earnings Explosion Spectacle Hides Vol Shift -- This is a New Company -- A Paradigm Shift is Complete


5-15-2013: Tesla (TSLA) - May Skew Stays Parabolic; Vol Diff Opens... And Some Stuff You May Not Have Known...


5-29-2013: Tesla (TSLA) - This is a New Company; The Paradigm Shift Continues; Part 3 of 3.


And today the stock is trading ~$155.

So there's no denying it now, TSLA is a big deal.. The market cap is approaching $20 billion. Here's the news from earnings:

---
NEW YORK (TheStreet) -- The thesis on Tesla Motors (TSLA_) changed again last night. Now, the question for investors isn't whether the electric-car manufacturer can be profitable, it's just how profitable it can be.

Tesla, led by CEO Elon Musk, earned 5 cents a share during its second quarter, generating $405 million in sales. The Model S continues to blow past the wildest expectations of industry observers as global deliveries surged in the three-month period to 5,150 units for the quarter.

In contrast, analysts were expecting a loss of 17 cents a share on $383.4 million in revenue for the second quarter.

Source: TheStreet.com via Yahoo! Finance; Tesla's Future Is Now, written by Chris Ciaccia.
---

Interestingly, the note mentions that the 5,150 units sold blew "past the wildest expectations of industry observers." On May 9th, with the stock trading at $70 I said this: "This is a new company, starting today."

But it was the May 15th article that was the most compelling. I wrote:
------
"After I wrote the post on May 9th, I actually walked into a TSLA dealership and spoke to a salesman. He was a shareholder (or so he said). I have no idea if what he said was true, or if it is already common knowledge, but according to him the firm sold 2,600 cars last year, and this year they are going to break 20,000. The cheapest model is $70,000 and the most expensive is $113,00. They are at full capacity -- which according to him was 500 cars per week -- and every car made is to order so production = sales."
------

Note that I said "they are going to break 20,000" units sold for the year. Well, if there are four quarters in a year, that would make 5,000 units per quarter at zero growth. I'm sorry to say, the 5,105 unit number is not a surprise to me and should not have been to anyone else. And, any analyst that would have walked into a dealership would have gotten the identical information I did.

Wall St. absolutely blew this one -- very poorly done. I'm just a guy chatting it up with a salesman. Come on guys, you gotta do better.

OK, off the soapbox, onto volatility. Let's start with the one-year Charts Tab. The top portion is the stock price, the bottom is the vol (IV30™ - red vs HV20™ - blue vs HV180™ - pink).



So, yeah, the stock is up HUGE.  A year ago this was a $29 stock and today it's flirting with $160.  And, as I mentioned earlier, we're not talking about a $100MM market cap now worth $700MM, this is now a $20 billion market cap company.

The volatility collapsed after earnings which is normal, and is now trading in the 46th percentile on an annual measure -- feels like right where it should be.  But there is something going on in the volatility, that continues to reflect substantial tail risk.  Let's turn to the Skew Tab, below.



I've just included Aug and Sep.  Even after earnings, Aug vol is still elevated to Sep (and yes I know Aug is expiring in a week and a half). What I do note is the relatively exponential skew of Aug compared to Sep. Or, in English, check out how the upside and downside skew is priced in Aug relative to Sep (green circles highlight it). There is a rather substantial vol difference from the front to the back monthly expiry in the OTM options reflecting much greater tail risk even in the next 10 calendar days.

Given the move off of earnings and just the move over the last year, that makes sense, but it also represents a trading opportunity.  For you risk lovers, a short gamma long vega trade in the OTM skew is up -- but that's a hell of a risk.

I'll conclude with a copy & paste from the article I posted on may 9th ($70 stock):

---
This is called a paradigm shift (well, that's what I call it) -- this company is now seen as a riskier entity. That's not bad news, in fact, for TSLA it's based on extraordinarily good news (earnings results). But TSLA is now a different company... and in this case, good for them... next level please...
---

This is trade analysis, not a recommendation.

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Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

BX closed Monday trading at $22.86,down 0.85 with IV30™ up 3.9% in a market that saw the VIX fall again (by 1.2%). The LIVEVOL® Pro Summary is below.



The Blackstone Group L.P. (Blackstone) is a manager of private capital and provider of financial advisory services. The Company is an independent manager of private capital worldwide, with assets under management of $210.2 billion as of December 31, 2012.

Let’s start with the Skew Tab for BX, below, to examine the month-to-month and line-by-line vols.



Lots of colors and lots of lines, but with a little direction it’s actually not convoluted at all. At $23 on the horizontal axis (which is ATM) go up from the bottom curve (green). The colors you will hit in order are:

(1) Green
(2) Blue
(3) Pink
(4) Brown (or whatever color that is)

Translating those colors to expiries reveals a pattern:
(1) Sep 2012
(2) Jan 2014
(3) Mar 2014
(4) Jan 2015

Or, in English, as we move from shorter expiries to longer-term expires the volatility monotonically moves higher. So the option market reflects more risk in a rather orderly fashion from the short-term through the intermediate-term and into the long-term.

OK… Is this unique to BX? Actually, no… And there are several ways to see this. Let’s start easy – let’s look at VIX options and back out the futures’ price.




Assuming essentially zero interest (which for this purpose is acceptable) we can see that the VIX forward price is higher with each expiry. Quick, back of the envelope math:

Forward VIX price = Strike + Call – Put
------------
Oct Forward VIX price = 16 + 1.65 – 2.20 = 15.45%
Nov Forward VIX price = 16 + 2.25 – 1.95 = 16.30%
Dec Forward VIX price = 17 + 2.30 – 2.47 = 16.83%
Jan’14 Forward VIX price = 18 + 2.47 – 2.80 = 17.67%

All of those levels are remarkable given that VIX spot closed at 11.84% today, but in any case, we see the same monotonicity. Further out = higher expected vol. So, BX is behaving like the broader market.

Let’s look at a BX and SPY vol chart (which is roughly equivalent to a BX vs. VIX chart) and let’s only focus on further out terms: IV120™, IV180™ and IV360™.



The greenish guys are BX the bluish guys are VIX. But focusing in each group by themselves, we can see that for both: IV120™ < IV180™ < IV360™. Again, further out expiries show greater vol. Looking a bit more myopically we can see that the spread between IV180™ and IV360™ is greater than the spread between IV180™ and IV120™. Or, in English, the one-year implied vol for both the VIX and BX show greater divergence from the half-year implied vol than the 120-day implied does. The real question then becomes, is vol really going to rise as we go further out in time? Well, there’s reason to believe it will, and the five-year VIX chart demonstrates this reason.
Provided by Yahoo! Finance

Each time the VIX peaked, it crashed for an extended period of time. Or, with a different perspective, each time the VIX has been depressed for a long-period of time, it has rapidly peaked. I’ve highlighted the last three peaks and we can see quite clearly how the VIX then made its way down. One point I do note, a VIX in the 11% range is lower than the other lows.

So, what to do if you like buying LEAPS? Vol is elevated to the back months – clearly. But, here’s the trick, LEAPS are elevated relative to the front, but the front is extraordinarily depressed. That means the comparison is to a low number. Check out the two-year chart of BX IV360™, below.




I’ve drawn that red horizontal line from the current IV360™ back in time. We can see just a couple of blips when the long-term implied was below its current value. So… now what?

Well, the back is elevated to the front, that’s for sure. There is contango in the VIX, that’s also for sure. But… for you LEAP buyers (which makes you big time vega buyers), this is one case where “elevated” vol actually still feels depressed.

I’ve included the identical picture below for the VIX for a broader view of the market (but this is only one-year of history; Livevol® does not provide two-years of VIX IV360™.



Same trick here… Yes there is contango in the VIX, but so what?... The long-term implied volatility is essentially at an annual low.

So, final conclusion? If you’re a vega buyer in LEAPS, don’t stop your analysis at the contango effect, there’s more to it. I don’t know if vol will go up or down from here, but for the last one to two years, LEAPS haven’t looked much cheaper than they do now.

This is trade analysis, not a recommendation.

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Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

This is trade analysis, not a recommendation.

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YELP closed Friday trading at $57.02, up 10.7% with IV30™ popping 29.2%. The LIVEVOL® Pro Summary is below.



Yelp Inc. connects people with great local businesses. Its users have contributed a total of approximately 36.0 million cumulative reviews of almost every type of local business, from restaurants, boutiques and salons to dentists, mechanics and plumbers. Its platform provides local businesses with a range of free and paid services, which help them to engage with consumers at moment when they are deciding where to spend their money.

I found this stock using a real-time custom scan. This one hunts for vol gainers on the day. But, there is so much more going on with this company beyond the one-day vol pop.


Custom Scan Details
Stock Price GTE $5
IV30™ GTE 30
IV30™ Percent Change GTE 10
Average Option Volume GTE 1,200
IV30™ Change GTE 7

Let’s start with the six-month Charts Tab below. The top portion is the stock price the bottom is the vol (IV30™ - red vs HV20™ - blue vs HV180™ - pink).



We can see the stock is up from ~$20 just six months ago and Y-O-Y is up from $22. So, rip roaring returns to say the least. But the stock movement went from deliberate and up, to abrupt and up in the last two days. The first catalyst was earnings – Wall St. liked it… a lot. The stock popped from $41.80 to $51.50 or ~25% in a day. Very nice. We can also the implied dropped after earnings – very normal and expected.

But then… today happened. The stock went from $51.50 to $57.02, making the two day gain more than 36%. But here’s the really odd part… Not only was the reaction to earnings a stutter-step, the vol reversed its decline and popped back up nearly 30%... huh?

A great way to examine this vol crush and rise is through the Skew Tab. First, let’s turn to the Skew Tab as of the close on Thursday.



We can see the front month ended right on top of the back month, crashing down from its highs pre-earnings. But then… today happened…

Let’s turn to the Skew Tab as of the end of trading on Friday.



All of a sudden the front month has popped right back up, almost like its pre-earnings levels. Something happened today that not only pushed the stock higher (after a 25% pop he day before), but now reflects more risk in the option market. This one, I must say, is an odd ball. I haven’t seen many of these reactions in a non-bio-tech in a while. So, good or YELP stock, but more risk indeed.

Finally, let’s turn to the Options Tab, below.



On close of Friday we can see Aug vol is priced to 69.06% while Sep is priced to 63.33%. Here’s how that pair of months traded for the last three days (on close).

Wednesday
Aug: 95.69%
Sep: 65.83%

Thursday
Aug: 50.91%
Sep: 51.15%

Friday
Aug: 69.06%
Sep: 63.33%

Look at the volatility level for the Sep options the day of earnings and today. They’re almost unchanged. This elevated risk in YELP has permeated not just the short-term (Aug vol) but also the intermediate-term (Sep vol). Something is up, and it’s more than earnings, the stock price and the volatility. I’d keep an eye on this one.

This is trade analysis, not a recommendation.

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Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

MOS is trading $41.88, up 1.92% with IV30™ down 4.1%. The LIVEVOL® Pro Summary is below.



The Mosaic Company (Mosaic) is a producer and marketer of combined concentrated phosphate and potash crop nutrients for the global agriculture industry. It is a single source supplier of phosphate-and potash-based crops nutrients and animal feed ingredients.

I found this stock using a real-time custom scan. This one hunts for calendar spreads between the front two monthly expiries. While there is a nice calendar diff to examine, this one has a much bigger underlying story.

Custom Scan Details
Stock Price GTE $5
Sigma1 - Sigma2 > 7
IV30™ GTE 30
Average Option Volume GTE 1,200

Let’s start with the Skew Tab to examine the month-to-month and line-by-line vols.



We can see two phenomena:
(1) Aug vol is elevated for all strikes relative to Sep.
(2) Aug vol has a decidedly upside bend to the skew, reflecting greater upside potential in the near-term than downside risk.

But there’s a huge story underlying this firm and many others in the potash biz. On 7-30-2013, in news from The Motley Fool I found that the world’s largest Potash producer broke up a cartel with Belarus that controlled almost 50% of global exports. The reaction was been abruptly poor for MOS – ~20% drop or $10 in stock price as potash price concerns are running wild.

The two-year MOS Charts Tab is included (below). The top portion is the stock price the bottom is the vol (IV30™ - red vs HV20™ - blue vs HV180™ - pink).



On the stock side we can see this was a $68.84 stock two years ago. But really, the story is more myopic than that. Checkout that collapse on 7-30-2013 I referred to. Yikes…

The stock drop was met with a huge amount of confusion or at least lack of clarity and we can see that in the volatility. I have included the two-year IV30™ chart below in isolation.



Two phenomena here strike me as noteworthy:

(1) The obvious explosion off of the cartel news. That’s a stock drop and a vol pop and it means risk (read: uncertainty) is here for now.
(2) Although the level in the implied is an annual high (after the cartel news), this name has actually seen higher levels of volatility in the last two years. In fact, the vol has been substantially higher, reaching just under 73% in October of 2011 (compared to 46.5% right now).

So what? Well... the uncertainty from the news hurt the stock, popped the vol, then today sort of gave way to calmer heads as the implied did dip a little. I just note that this level of vol is not unprecedented and there is grounds to believe it could go even higher. But obviously there’s no way to predict the future. In my opinion, closure has not come in on the news and that means equilibrium has not been reached and that means risk…

Finally, let's look to the Options Tab (below).



Across the top we can see the monthly vols are priced to 50.13% in Aug and 41.68% in Sep. It’s that volatility divergence that triggered the calendar spread scan. But as I’ve said two times before and now for a third, there’s a lot more to this than just a calendar vol diff.

This is trade analysis, not a recommendation.

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Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

The information contained on this site is provided for general informational purposes, as a convenience to the readers. The materials are not a substitute for obtaining professional advice from a qualified person, firm or corporation. Consult the appropriate professional advisor for more complete and current information. I am not engaged in rendering any legal or professional services by placing these general informational materials on this website.

I specifically disclaim any liability, whether based in contract, tort, strict liability or otherwise, for any direct, indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of the site, even if I have been advised of the possibility of such damages, including liability in connection with mistakes or omissions in, or delays in transmission of, information to or from the user, interruptions in telecommunications connections to the site or viruses.

I make no representations or warranties about the accuracy or completeness of the information contained on this website. Any links provided to other server sites are offered as a matter of convenience and in no way are meant to imply that I endorse, sponsor, promote or am affiliated with the owners of or participants in those sites, or endorse any information contained on those sites, unless expressly stated.

NQ is trading $15.95, down 1.2% with IV30™ up 0.7%. The LIVEVOL® Pro Summary is below.



NQ Mobile Inc. (NQ), formerly NetQin Mobile Inc., is a holding company. The Company is a global provider of mobile Internet services focusing on security, privacy and productivity. The Company is a provider of Freemium subscription services with approximately 242 million registered user accounts in over 150 countries.

This is a vol note -- a rather explosive one along side some explosive stock moves of late. All of these phenomena are in the backdrop of an earnings release 8-12-2013 (BMO), or in English, in twelve days.

Let's start with the one-year Charts Tab below. The top portion is the stock price, the bottom is the vol (IV30™ - red vs HV20™ - blue vs HV180™ - pink).



One year ago this was a $7.82 stock, so it has seen more than a 100% rise in the last twelve months. But, as we can see in the stock chart, that's not the eye-popping part. Look at the stock rip of late. On 6-24-2013 this was a $7.38 stock. Now, just six weeks later, the stock is up more than 115%. Whoa...

And what about the volatility... yeah... what about it?... let's turn to the one-year IV30™ chart, below.



On 7-18-2013 the implied closed at 72%. Today we see it trading over 135%. So a 90% (ish) increase in thirteen calendar days. The vol rise is in coincidence with the stock rise, so I'm not buying the idea that this is simply a reflection of the earnings announcement due out in a couple of weeks. In fact, the prior high in IV30™ into an earnings announcement (before this one) was 110%. We're already 25 vol points higher (actually it's 27 vol points a I'm writing this article) with quite some time before the actual earnings date.

This is both a phenomenally high stock price and volatility level for NQ. The 52 wk low in IV30™ is 64.02%.

Finally, let's turn to the Options Tab.



Across the top we can see that Aug vol is priced to 146.56% and Sep is priced to 119.95%. The Sep number is quite elevated to the vols in the last year, not to mention Aug, which is in its own world.

This is one to watch... right now...

This is trade analysis, not a recommendation.

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Legal Stuff:
Options involve risk. Prior to buying or selling an option, an investor must receive a copy of Characteristics and Risks of Standardized Options. Investors need a broker to trade options, and must meet suitability requirements.

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