Put Players Liquidate Bearish Bets on YRC Worldwide Inc. 1/18/2011 1:38:00 PM permanent link Keywords: YRCW Traders are gravitating toward puts today on YRC Worldwide Inc. (YRCW), with more than 9,100 contracts crossing the tape so far -- easily outstripping the stock's typical daily put volume of 1,285 contracts. The most active strike is YRCW's April 5 put, where 5,010 contracts have been exchanged. However, it doesn't look like new bearish bets are being added here today. About 99% of those April 5 puts traded closer to the bid price, suggesting they were sold, and implied volatility on this back-month strike has deflated by 11.8 percentage points as a result. With 16,758 in-the-money contracts currently in open interest at the April 5 put, it looks like put buyers are taking profits on their winning positions. YRCW has been a long-term underperformer, as evidenced by the stock's 52-week deficit of nearly 85%. However, put buyers could be liquidating their positions today due to a sudden 6.9% surge in the shares, which has YRCW on pace to notch a daily close above its 10-day and 20-day moving averages for the first time since Dec. 30. Despite today's spike higher, though, it may be too soon to bet on a continued bounce for YRCW. The $4 region looms almost directly overhead, and this area has acted as a technical ceiling since early November. -posted by Elizabeth Harrow (eharrow@sir-inc.com)
1/18/2011 1:38:00 PM
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