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« Endeavour Silver Corporation Up 4.23% Today | Main | Why Are Silver Sales Soaring? »
Monday
Apr122010

Pan American Silver Corporation: Recent Options Trading Activity

PAAS Chart 13 April 2010.jpg



The following is a snippet from Market Intellisearch regarding the recent action in the options market for Pan American Silver Corporation (PAAS) and its ramifications for the stock price.

NEW YORK (Market Intellisearch) -- PAAS options saw interesting call activity today. A total of 241 put and 1,711 call contracts were traded raising a low Put/Call volume alert. Today's traded Put/Call ratio is 0.14. There were 7.10 calls traded for each put contract.

A significant increase in the trading volume of a stock's option often is a precursor of movement by the underlying stock. In such instances, Put/Call Ratio can be used as an investor sentiment indicator, where a high ratio implies that the overall investor sentiment is bearish and a low Put/Call ratio implies that the overall sentiment is bullish.

Posted on 04/07/2010 by Leo Goldman



As we can see from the above chart the stock price has moved higher since the 7th April 2010 and has increased 25% over the last 6 weeks or so.

The PUT/CALL ratio is another technical indicator than can give us a pointer to the possible future movement of the stock. Do remember that none of them are perfect but they can be helpful from time to time.

Got a comment then please add it to this article, all opinions are welcome and appreciated.


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Reader Comments (2)

You state re PAAS that a low PUT/CALL is bullish but give no indication what defines 'low'? Is 0.14 low?

Thanks,

Julian

April 13, 2010 | Unregistered CommenterJulian Smith

Yes, the inference is that the increased activity in Calls over Puts is a positive one, although we could debate that too.

April 13, 2010 | Unregistered CommenterSilver Prices

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