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February 21, 2014  Fri 11:06 AM CT

ACAS: SEE CHART GET CHAIN FIND STRATEGIES
A large put trade in American Capital is part of a volatility strategy as shares continue to climb.

optionMONSTER Depth Charge system shows that a trader bought 10,000 August 12 puts for the ask price $0.22. There was no previous open interest at that strike, so this is a new position.

Less than 2 minutes later a block of 100,000 shares traded for $16.06. So the overall strategy is apparently a delta-neutral play that is looking for higher volatility than that implied by the option price. (See our Education section)

ACAS is up 2.53 percent to $16.19 in midday trading, its highest level since hitting a 52-week high of $16.28 a month ago. The private-equity firm dipped as low as $14 after releasing earnings results two weeks ago.

More than 21,000 ACAS options have traded so far today, 5 times its daily average for the last month.
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Options Academy: Ron's Risk Calculation--A Real Life Example

It is rare that I get a chance to give a real-life, real-time example in my articles that the readers were not only following but were actually involved in at the time the event is happening. Well, that is where we are right now in our QQQ trade from last week. Let's recap the trade itself.

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