Traders who expect stocks to go down, also known as bears, seem to be moving out of positions in Apple. Bloomberg notes that prices of puts, or bearish bets on Apple shares, have dropped to a one-year low in the wake of Steve Jobs' resignation.
Instead of increasing equity swings, Apple shares are almost unchanged since Aug. 24 when Jobs, who turned the company into the world’s biggest by market value, said he resigned. Implied volatility for three-month options at the current stock price fell to 1.07 times the level of historic volatility, down from this year’s peak of 1.9 in February. Options usually rise when moves in the underlying security increase.
The stock’s implied volatility has dropped 14 percent to 35.72 yesterday from this year’s peak of 41.71 on Aug. 8, data compiled by Bloomberg show. Sixty-day historical volatility has risen to 33.36, the highest since July 30, 2010, the data show.
"The uncertainty hanging over the stock is removed," Jack Ablin, who helps oversee $60 billion as chief investment officer for Chicago-based Harris Private Bank, said in a telephone interview.
Cheaper puts mean the broader market feels good about Apple's prospects going forward under new CEO Tim Cook, and expect the company's record growth to continue.
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