CXR Option Market -- updateSomeone trading CXR options has lost their mind. They are paying 100 vol plus for August, 115 Vol for June. After earnings?!
This is an incredible opportunity for those who are long the stock. August should be trading at 60 vol. So if you sell a call (let's say the Aug 46 at 2.60) I think if the stock goes to $40 you will be able to buy them back for the same nominal price or cheaper! It's like the option market is giving out free protection. -- That or the trader is so certain the stock is going much higher. Either way being long the stock or having a covered call position should work out.
Hell i would even selling naked puts at these prices! You could sell August 22 puts for $1.50. Is the stock going to $20 in 3 months after that solid earnings and conference call?