yesteday nearly 10000 oct 7 and 8 calls bought so 20k of calls bought in 2 days between 6-8 strike price
i have a few of those sept 7's but only a handful. GOD if i were to wake up one morning and see OCZ @ 15 before O/E in sept....
ohh sorry for daydreaming, ok back to work now.
i believe people are just buying them back to close... if you sold those calls while on margin, you would need to buy them back so you could sell your stock. I know I did that since OCZ's margin requirements were changed today for my broker.
If OI is increasing it suggests speculation. It doesn't look so much like they know anything though - diff strikes, diff expirations, and no (obvious) offsetting sales to finance the purchase. I think people are gaming a buyout, but don't know any more than any of us. It seems plausible to them, and so they buy lotto tickets.
Might work - might not. Haven't done it, but I'm inclined maybe to write some Dec puts. IV still very high, and I don't think the stock is going under 2.80... maybe use the proceeds to buy some spec otm calls in oct (diagonal ratio risk reversal). (Don't do this if you don't understand the risks of options - this is not a recommendation, just idle musing.)
Basically, I think the odds of a buyout vastly exceed the odds of the stock going to 2.80 or whatever - both are tail events though. Only thing that does #$%$ me a bit is how easily the stock moved down to 3.70 (pre-market) on a (relative to the move) minor piece of news.
I had sold some covered 6 & 7 during the past 4-6 weeks and bought them back for a nickel. I'm sure there is some of that going on, but wouldn't be surprised if it's also short hedging on the cheap to protect against some type of OCZ NAND news release that would alleviate revenue concerns the next couple of quarters. And speculating buying for the same reason as well.
since there is a huge amount of calls sold, i could see why people want to buy them back. they were sold for $0.30-2.54 if you sold at any one of those strikes you be making bank. same with yesterday.
Remember, not everything happens because someone knows something you don't. We all know there are rumors of a BO. It may or may not happen, and so people may be speculating.
Don't put too much faith in it meaning anything at all.
Then again - I said this a few days ago when the stock dropped 50 cents - sometimes there are leaks - but sometimes the trades you see don't mean anything at all.