ONN Reports That SEC Investigation into American International Group Causing Spike...

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Fri Jun 6, 2008 8:59am EDT 

ONN Reports That SEC Investigation into American International Group Causing Spike in Options Volatility

                OptionsNews on ONN.tv for June 6, 2008
CHICAGO--(Business Wire)--
OptionsNews, the daily news program on www.onn.tv, today reported
on the following companies:

   In a somewhat anticipated move, the SEC and Justice Departments
have reportedly begun investigations into American International Group
(AIG) regarding the overstatement of contracts linked to subprime
mortgages. You'll remember that we reported back on May 30 that we
might be seeing light at the end of the tunnel for AIG after Morgan
Stanley (MS) upgraded shares in the company from equal weight to
overweight. The skew in AIG options remains high, with the implied
volatility in the downside puts being much higher than the
at-the-money puts as traders clearly expect the stock to move lower
due to this investigation.

   Thursday's option volume for indexes and single stocks registered
just over 13 million contracts, lower than the year to date average of
14 million contracts, and higher than Wednesday's volume of nearly 12
million contracts. The CBOE volatility index, also known as the VIX,
ended the day at 18.63, down over 10% from Wednesday's close of 2080.

   Ameren Corp. (AEE) and Hewlett-Packard Co. (HWP) both go
ex-dividend on Monday morning. Remember, if you own call options, you
will NOT get this dividend. If you own deep in-the-money calls, talk
to your financial advisor about the merits of exercising those calls
to get those dividends. Ameren closed the day yesterday at $44.52 and
Hewlett-Packard ended trading at $48.45

   One company to keep your eye on today would be Marriott
International Inc. (MAR), which saw heavy trading in the June 32 1/2
calls yesterday of over 9000 calls. Those contracts closed the day at
60 cents, and the June 30 straddle closed the day at $2.17.

   About the Options News Network:

   Serving a rapidly growing segment of the investment community, The
Options News Network provides daily options news and entertainment,
options education, options trading ideas, options strategies and
expert commentary on the options market, targeting options traders of
all skill and experience levels as well as stock investors thinking
about options.

Options News Network
Ed McDaries, 312-362-2548
info@onn.tv
www.onn.tv

Copyright Business Wire 2008
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