Option Block 571: TSLA Puts and Election Volatility

The Option Block

Trading Block: Dow soars 300 points after FBI clears Clinton again. Are certain volatility funds raising election risk for the stock market? Earnings today after the bell

• Fogo de Chao
• Hertz Global Holdings
• Marriott International - ATM Straddle = $2.75, approx. 4%
• The Priceline Group - ATM Straddle = $82, approx. 5.5%

Odd Block: Calls trade in SPDR KBW Bank ETF (KBE), calls and puts trade in iShares MSCI Mexico Fund (EWW) and puts trade in Marathon Oil Company (MRO)

Mail Block/Options #QuestionOfTheWeek:

$SPX Weds Weekly straddle says 2% move through election. How much will SPX / $SPY move through Weds 11/9?

• Over 3% - crazy move
• Between 2-3% - big move
• Between 1-2% - mild move
• Less than 1% - "meh"

Listener questions:

• Question from RKintz - What do you guys think of out of the money puts on PBR? I noticed heavy buying across several expiries the last few weeks (possibly speculation of prolonged glut in oil supply)
• Question from Real RK - What do you guys think of being long a little less than one standard deviation puts OTM for Jan in everyones favorite hyperbolic name Tesla?

Around the Block/Earning Highlights This Week:

• Tuesday - Valeant, CVS Health
• Wednesday - Valeant, Mylan, Shake Shack, Macys
• Thursday - The Walt Disney Company, Nvidia, Kohls, Nordstrom
• Friday - JCPenney