Options Update: UBS AG (UBS) & Lehman (LEH)
UBS AG (UBS)
UBS Volatility Elevated At 82 Into $11.9B Loss & $19B Write Downs
UBS is recently trading at $30.89, above its close of $28.80.
UBS reported a $11.9 billion quarterly loss.
UBS will write down $19 billion on debt securities, bringing the total to approximately $37 billion over the last nine-months.
Standard & Poors lowered its credit rating on UBS to AA- from AA. Deutsche Bank raised UBS to Buy.
UBS over all option implied volatility of 82 is above its 6-month average of 42.
Lehman (LEH)
LEH April Volatility At 127 Into Preferred Convertible Offering
LEH is recently trading at $39.35 in pre-open trading, above its close of $37.64.
LEH announced it intends to offer 3 million shares of Non-Cumulative Perpetual Convertible Preferred Stock.
Sandler O'Neill says "In the wake of a 43% YTD share price decline (26% in March alone), it seems like an expensive time to raise capital."
LEH April option implied volatility of 127 is above its 6-month average of 57."
About Paul Foster
Paul Foster is a former member of the Chicago Board Options Exchange with 21-years of professional experience in the capital markets, investments, trading, corporate finance, arbitrage, options and mergers & acquisitions. His writing about the options market has appeared in a wide variety of publications.
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