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Interesting charts. Where can these be
found? There was a web site that used to provide this information and
more, but I seem to have misplaced the URL. Thanks, Ira.
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>
----- Original Message -----
<DIV
>From:
Ray
Raffurty
To: <A title=realtraders@xxxxxxxxxxxxxxx
href="">realtraders@xxxxxxxxxxxxxxx
Sent: Saturday, March 08, 2003 5:23
PM
Subject: Re: Whopping Premiums, was : RE:
[RT] Re: Fedback-This Week's Most Unusual Covered Call
The attached chart shows that implied volatility
of the OEX which usually tracks 30 day historic volatility has increases
substantially in the last few weeks.
Good luck and god trading,
Ray Raffurty
<BLOCKQUOTE
>
----- Original Message -----
<DIV
>From:
M.
Simms
To: <A
title=realtraders@xxxxxxxxxxxxxxx
href="">realtraders@xxxxxxxxxxxxxxx
Sent: Wednesday, March 12, 2003 1:56
AM
Subject: Whopping Premiums, was : RE:
[RT] Re: Fedback-This Week's Most Unusual Covered Call
Speaking of
options, has anyone taken a gander at the whopping premiums of index options
like the OEX in the current expiration Month ?
Holy
moly....lots of opportunities here in shorting premium if the angst is near
it's max.
2 weeks ago,
long puts was a great position, but RIGHT NOW I can't see going long
<any> options at this juncture, can you ?
<FONT color=#0000ff
size=2>
<FONT color=#0000ff
size=2>
<BLOCKQUOTE
>
<FONT face=Tahoma
size=2>-----Original Message-----From: Ray Raffurty
[mailto:r.raffurty@xxxxxxxx]Sent: Saturday, March 08, 2003 6:00
PMTo: realtraders@xxxxxxxxxxxxxxx; John CappelloCc:
MedianLine@xxxxxxxxxxxxxxxSubject: Re: [RT] Re: Fedback-This
Week's Most Unusual Covered Call
Correction: The <FONT
face="Courier New" size=3>cash in lieu of 0.30422 share of Travelers
Property Casualty Corp. Class A ("TAP.A") Common Stock; plus cash in lieu
of 0.84326 share of Travelers Property Casualty Corp. Class B will be a
lot more than what I said since TAP.A is at is at $14.40 and B is at
14.44. Sorry, but it will be around $16.20 per
contract.
<FONT face="Courier New"
size=3>
Good luck and
good trading
<FONT face="Courier New"
size=3>
Ray
Raffurty
<BLOCKQUOTE
>
----- Original Message -----
<DIV
>From:
Ray
Raffurty
To: <A title=jvc689@xxxxxxx
href="">John Cappello ; <A
title=realtraders@xxxxxxxxxxxxxxx
href="">realtraders@xxxxxxxxxxxxxxx
Cc: <A
title=MedianLine@xxxxxxxxxxxxxxx
href="">MedianLine@xxxxxxxxxxxxxxx
Sent: Saturday, March 08, 2003 5:40
PM
Subject: [RT] Re: Fedback-This
Week's Most Unusual Covered Call
Hi John,If you purchased 100 shares of C and
sold 1CLTCC call your are NOTcompletely covered. In August of
2002 Citigroup spun off it's TravelersInsurance division <A
href="">http://www.citi.com/citigroup/press/020820a.htm
anddistributed the Traveler shares to owners of Citigroup stock in
the ratiodescribed at<A
href="">http://www.cboe.com/common/pageviewer.asp?file=02-454.doc&dir=ttstocksm&head=stock%20splits%20%26%20mergers&sec=5Since
options, including the March 15 CCC calls, where trading at the
timethose contracts had to be adjusted to include the shares
distributed and theoption symbols where changed to as the LT thus
CLTCC is a nonconformingoption. At the time of the
distribution a new series was created foroptions sold after that
date without the LT symbol to indicate 100 shares ofCitigroup
only. In other words if you owned 100 shares of C in early
August2002 and sold (1) 15 CCC call you would be required to deliver
both the 100Citigroup shares PLUS the shares of Travelers you
received, if exercised,and the symbol was changer to CLTCC.
After the distribution date if youpurchased 100 shares of C and sold
1 CCC 15 call you would be covered. Asfar as I know the
unusual option symbol is always the nonconforming one.If you
look at the attached chart you will see that in every case the
optionwith the LT designation is trading at a higher bid and ask for
the samestrike than the option without the LT. This occurs
because the value of theoptions are determined by adding the value
of the various Travelers sharesto the 100 Citigroup shares.I
don't what Smith Barney told you but CLTCC is a 15 strike, it's just
formore than 100 shares (nonconforming). If you go to the
OptionXpress website and go to the calls only option chain you can
check a box to show thenonconforming options. If the box is
checked the LT series shows and if itis not checked they don't
show.I believe the quote you got over the week end on CCC was
erroneous. Theremay not even be a market in that option
currently (in is no longer showingup). It is possible that the
data from which the various option chains arecreated had defaulted
to an old quote when it found no new prices. Also,when you use
a website to search for option yielding a high % on coveredcalls you
must be very careful. They often do not screen out
nonconformingoptions but calculate the % gain based on 100
shares!!!!!!!!!!!!!!!!!!! Ihave been burned this way and
learned to check the CBOE's web site whensomething looks to
good.If you entered an order to sell CCC, I would question why
your brokersubstituted the nonconforming CLTCC and demand it be
undone. He should haverejected the order or given you the
price on CCC. If, however, you enteredthe order to sell CLTCC
you need to either close the trade before expirationor plan to
purchase the various Traveler's shares required to be covered(more
commissions). In this case, perhaps your kindly old broker will
undothe trade..., NOT. You can always do nothing, but you will
be shortTravelers on 2/24/03 after the options are exercised.
You can then buy toclose the short, but the market has a way of
moving to make this the worstpossible outcome, not to mention
additional commissions.The short will be: 4 shares
of Travelers Property Casualty Corp. Class A("TAP.A") Common Stock;
plus 8 shares of Travelers Property Casualty Corp.Class B ("TAP.B")
Common Stock; plus cash in lieu of 0.30422 share ofTravelers
Property Casualty Corp. Class A ("TAP.A") Common Stock; plus cashin
lieu of 0.84326 share of Travelers Property Casualty Corp. Class
B("TAP.B") Common Stock.Also notice that there are 2 "cash
in lieu of" components. This means youwill need to pay out
that cash to the option holder ($1.15 per contract).This cash is
probably to adjust for fractional shares that wheredistributed, but
which could not be accounted for otherwise.I think the odds are
against you on this and you will be lucky if you onlytake a small
loss. Unfortunately the market does not hand out money
thisway. Occasional there will be small discrepancies in
option price to stockprice, pennies or less. Then
professionals will move quickly on volume andlow commissions to
close the discrepancy.Good luck and good trading,Ray
Raffurty----- Original Message -----From: "John
Cappello" <jvc689@xxxxxxx>To: "Ray Raffurty"
<r.raffurty@xxxxxxxx>; <realtraders@xxxxxxxxxxxxxxx>Cc:
<MedianLine@xxxxxxxxxxxxxxx>Sent: Monday, March 10, 2003 2:07
PMSubject: Fedback-This Week's Most Unusual Covered
Call> Dear Ray,>> I just did a double check
with Smith Barney and the correct symbol> for the $15 strike
price is CLTCC.... which is what I sold. Options> Express also
confirms this. The other designations just further> describe the
Travelers acquisition from last year...and have nothing> to do
with pricing other than history.>> When I first looked at
this trade, the $17.50 strike price was in the> profit mode to
sell the call and buy the stock...that is now close to>
parity.>> Hope this helps.>>
Sincerely,>> John>>>>>
------------------ Reply Separator -------------------->
Originally From: "Ray Raffurty" <r.raffurty@xxxxxxxx>>
Subject: Re: [RT] This Week's Most Unusual Covered Call> Date:
03/08/2003 06:54am>>>
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