Are Apple Options Traders Too Complacent Ahead Of Earnings?

Despite the stock's recent demise, and 'shocking' analyst downgrades, Apple options traders appear exceptionally calm ahead of tonight's earnings report…

Even with Apple forecast to post a slide in quarterly earnings after the close, investors are calmer than they were before previous reports. As Bloomberg reports, The CBOE Apple VIX Index, which tracks volatility expectations for shares of the iPhone maker, closed yesterday at its second-lowest level on record before an earnings release, and 16 percent below its one-year average.

 

Options are pricing in a 4.4% gain or drop in the stock after the results, less than its average move following the past four reports.

Since the earnings tumble, it seems the correlation regime of the stock price and volatility has flipped (until very recently).

Charts: Bloomberg

via http://ift.tt/2a506Rm Tyler Durden

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