Ship Finance (SFL) loses $1.28 to $9.65 and implied volatility in the options on the stock is elevated, amid increasing put volume today, after Moody’s downgraded the stock today. 2,060 puts and 340 calls traded in SFL. By way of comparison, typical volume through midday is 500 contracts. Jan and Feb 7.5 puts are the most actives, with 876 and 544 traded, respectively. Directional sentiment based on the overall flow is 65 percent bearish and implied volatility jumped 27 percent to 101. Ship Finance was the subject of bearish order flow last week after peer Frontline (FRO) warned that working capital was becoming an issue (see 11/22 color). SFL reported earnings on 11/23.
About the Author (Author Profile)
Frederic Ruffy is a well-known trader, writer, and strategist who has spent years educating investors and creating intelligent, insightful, unbiased market observations that are frequently cited by the Wall Street Journal and other financial publications. As senior analyst, Fred provides frequent and regular notes and daily updates for activity of interest.