Ticker of the week: GE

Hey Traders,

Join us on Monday when we walk through the GE trade at 10:30 et.

General Electric Corp (Ticker: GE) was a much more fun stock to trade before they split it 1 for 10 over a year ago. After the split the stock went from $100 to $50 and now has been pretty steady moving higher over $100. The last earnings were great and GE flew to $114 only to crash back over the next few days as you can see below.

30 day GE chart with Nov, Dec, Jan Sigma vols

Most of the IVs are below the earning lever but there is bit of a surprise creeping up.

Let’s see if there is a volatility trade for it.

January IVs are near 1 year highs

IV90 and January IVs are very close to the same thing. Note all of a sudden IVs have spiked post earnings and that is not normally what happens. GE is caught up in market volatility since there is turmoil in the Middle East. IVs are unusually high.

90 Day IV in Green and 90 day HV In purple.

That would set up broken wing butterflies, iron condor or some other short volatility type trade for GE. Earnings were good but IV is super high with all of the unease going on. Monday should be interesting to see if the market has the legs to push to 4000 or the selloff takes a pause. The higher IV means there is much better premiums to sell out of the money than normal. Mark, Licia and and I will hit this topic on Monday.

Questions about that? Leave a comment below!

To Your Trading Success,

AG