How Deep Will Government Spending Cuts Go? Ask Ceradyne (CRDN)
by Houghton and Atkeson 08/25/08
Options trading in Ceradyne (CRDN) has caught our interest today.
Market participants have traded roughly five times the amount of puts to calls. With the stock trading at $44.55 -- almost 50% off its lifetime high in July 2007 -- traders are seemingly making a bearish bet in the ceramic products manufacturer. In particular, there looks to be opening buyers of 1,000 of the CRDN Oct 37.50 Puts (AUEVU).
In addition, there are many lines in the September puts that have seem some action today. Is this big winner of U.S. government defense contracts going to feel the chill from Washington?
Ready to get in on the big-money options trading action? Sign up for your risk-free trial to Nick and Andrew's Big Money Options service, which gives you 2-3 specific trading recommendations a week, delivered by e-mail, PLUS timely profit alerts and trade updates.
More By This Expert
Looking into June, the market should begin refocusing on upcoming earnings reports for evidence the economy is gaining momentum.
Watching the Treasury's Actions
In the short-term, the government's bond auction is likely to be a key driver of stocks.
Treasury Auction Boosts Market
The Treasury's auction of two-year notes brought an upside surprise which should alleviate fears of a lack of demand for U.S. paper.
Credit Markets Point to Upturn
The credit market, a reliable indicator of equity direction, suggests we will break out of the SPX's trading range to the upside.
The market seems to be saying that a 30% move up from the lows is ahead of the real economy and the market needs to allow the economy to catch up.
- What's Hot: DELL, DHI November 20, 2009
- Sidewinder: MCD, DKS, JPM November 20, 2009
- Options News: SII November 20, 2009
- Sidewinder: CY, ADSK, KG November 19, 2009
- Options for Dummies November 19, 2009
Options Broker Center
