Option Market Alert: Vicor Corporation Implied Price Swing Hits An Inflection Point

Vicor Corporation (NASDAQ:VICR) Risk Hits An Inflection Point

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No Risk Alert Here: Before we dive into any analysis we simply note that Vicor Corporation (NASDAQ:VICR) risk is neither elevated nor depressed. We'll detail it below -- but that's the lede -- the option market is in a holding period with an IV30 of 36.97% verus the IV30 of the S&P 500 at 11.15%. You might say that the post it note for Vicor Corporation would read, "holding pattern." The annual high for Vicor Corporation IV30 is 65.28%.

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This is a proprietary risk rating and risk alert system that looks forward for the next month -- or really 30 days to be exact -- and that includes weekends. The system is based on multiple interactions of data points, many of which come directly from the option market for Vicor Corporation (NASDAQ:VICR) . The creator of this model is Capital Market Laboratories (

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In the "Why This Matters" section at the end of this article on Vicor Corporation we're going to take a step back and show in great specificity that there is actually a lot less "luck" in successful option trading than many people know. The whole concept of an "option trading expert" is vastly over complicated and we'll talk about how superior returns are earned.

But first, let's turn back to VICR and the company's risk rating:

We also take a peek at the implied vol for the Technology ETF (XLK), our broad based proxy for VICR.

S&P 500 IV30     11.15%
Nasdaq 100 IV30     12.44%
XLK IV30     12.46%

VICR HV 30     33.2%
VICR Current IV30     36.97%
52 Week Low IV30     33.97%
52 Week High IV30     65.28%

The implied price swing risk as reflected by the option market has hit an inflection point relative to the company's past. The option market reflects a 95% confidence interval stock price range of ($15.40, $18.30) within the next 30 calendar days.

The IV30® is the implied price swing risk reflected by the option market in the stock price for the next 30 calendar days -- it's forward looking. Vicor Corporation shows an IV30 of 37.0%, which is an inflection point for the company relative to its past.

The option market for VICR has shown an IV30 annual low of 34.0% and an annual high of 65.3%, meaning that VICR is at the 10% percentile right now. Here's a table of the data before we dig into the implied price swing risk rating further.

Current IV30    
Low IV30    
High IV30   
37.0% 34.0% 65.3%

The implied stock swing risk from the option market is extremeley tight in the next 30 calendar days for Vicor Corporation (NASDAQ:VICR) relative to the average in the last year.
Further, if we look backwards, the stock has a realized 30-day historical volatility, called the HV30, of 33.2%.

We have an unusual situation now where the IV30 is extremely depressed relative to the past, but even with that risk pricing, the option market reflects the likelihood of more stock movement in the next 30-days than it has in the last 30-days. Let's turn to a chart to see what's going on.
Note how much higher the forward looking stock swing price risk for Vicor Corporation is priced (37.0%) compared to what happened just in the last 30-days (33.2%).

Vicor Corporation Risk Rating
The VICR risk rating is at 3, where the rating goes from one (the lowest risk) to five (the highest risk). The driving factors for the 3 rating are:

The IV30 is below the 20th percentile.
The HV30 is below the annual average.
The IV30 is above the HV30.
The stock has moved +15.8% over the last 3-months which does indicate some elevated risk.