FXCM Share Prices Explode After Heavy Options Purchasing

FXCM (NYSE:FXCM) has been a tough company to figure out these past few months, namely for the Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad Read this Term seen in its share prices, which continued during a shortened trading week.

The big jump in FXCM share prices (NYSE:FXCM) came after last week’s news that the company would assume the vast majority of margin foreign exchange (FX) accounts of CitiFX Pro from Citibank N.A. and Citibank International Limited (Citibank) via its US subsidiary Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term Capital Markets LLC (FXCM US) and UK subsidiary Forex Capital Markets Limited (FXCM UK). Markets were closed Monday due to the observance of the Memorial Day holiday.

When trading opened Tuesday, investors were not disappointed.

FXCM closed at $1.22 last Friday, May 22, having witnessed a -15.9% loss WoW. The long holiday weekend in the US proved to be a panacea for the beleaguered broker’s shares however, catapulting prices over the $1.75 handle for the first time in a week. Yesterday’s 33.61% gain in FXCM share prices were the largest single-day thrust since bottoming out back in January.

However, the real culprit for the surge in yesterday’s shares of FXCM were due to heavy $1.50 August calls. More specifically, nearly 1,465 August $1.50 calls were traded yesterday, over 1.5 times the open interest of 873. Alternatively, zero August $1.50 puts were traded versus an open interest of 231, according to a recent Benzinga report.

At the time of writing, FXCM shares are trading at $1.66 ahead of the US open.