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Elan Corporation, plc Message Board

  • billybobsdogg billybobsdogg Jul 13, 2012 1:11 PM Flag

    ELN range bound between 13 and 16 ?

    One investor apparently thinks that Elan will remain trapped in a range, even with earnings later in the month.

    optionMONSTER's monitoring programs detected the sale of 20,000 October 13 puts for $2.30 and 20,000 October 16 calls for $2.05. Volume exceeded open interest at both strikes, indicating that new positions were initiated.

    Known as a short strangle , the trade resulted in a credit of $4.35 which the investor will get to keep if the Irish drug maker remains between $13 and $16 through expiration. Gains erode outside of that range, turning to losses below $8.65 and above $20.35.

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    • there are, imo, at least two things influencing
      the daily price action of ELNs stock price, away from
      the basic fundamentals and FDA stuff.
      obviously, those who wish to be 'long' or 'short',
      'buy' or 'sell' the stock, esp larger players.
      then there are some large 'options' positions that
      are either put on, taken off, added to, 'rolled', delta
      re-wtd., hedged/wedged etc., which can, it seems come
      out of no where, to influence the stock price, esp on a
      low vol day, and the closer to exp dates.
      this happens w/all stocks that have options but I think
      more so w/a stock as ELN. it's a big part of it. there are
      mucho 'premium' dollars hanging out there for some to
      (perhaps) wish to take advantage of, esp if they wish to
      define the ranges ELNs stock price will exhibit.


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