Ok this is amazing...Sell the June 25 Calls for $2 bucks, buy the June 30 Calls for protection for $1, net credit $1 dollar, risk $4, 25% return. This stock has to go to $26 in the next 12 days for you to lose money. Amazing! If you are a long whos been crushed by this stock, here is the way to get back to even! Im not selling, just sharing! For God so loved the world that he gave his only begotten son, for whosoever beleiveth in him should not perish, but have everlasting life. John 3:16
this is a good trade that takes advantage of the huge premiums. My feeling is this: a negative 6/15 ruling is priced in. The FDA in its eminent wisdom won't entirely trash the device, but certainly won't embrace it. The resulting price action makes a $22-$26 range seem reasonable. If they pull the rug out (a la GNTA), you get to keep the spread. thx for the post.
I don't think the negative outcome from June 15th meeting is priced in the stock ... the stock will in the $10 range if the panel does not recommend approval. However I believe the stock will run up between now and Jun 15th meeting. Good time to buy calls now and puts when and if the stocks runs up.