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Xinyuan Real Estate Co., Ltd. Message Board

  • brianchesnutt brianchesnutt Mar 10, 2014 1:03 PM Flag

    HUGE options move

    Thought this deserved its own topic. Credit to lmtage for pointing this out. 5,498 contracts traded at $0.29 March $5.00 exercise. Someone paid $165,000 for these things.

    People don't throw around that kind of money without good reason. That's quite a spike. Fat finger?

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    • Thnx for post'n. Expires in 9 days / 22nd. Isn't it 5498 X 29 + comm? - they are probably not smiling today though I'd bet the transaction works for them because I think the short-term trend is heading up here. Lotta cash to gamble / it will be interesting to watch. especially to figure when they get outl though i'll probably miss it. And I'd think they will be selling out in smaller blocks.

      • 2 Replies to dannylct
      • it's 5500x100 for 550,000 shares. each contract was somewhere between $25 and $30 it looked like to me an average of about $29.00

        Break even on that would be $5.30. May not hit that by March 22nd, but again, I don't think that's the issue. I think they wanted to buy in without driving the price up too high, and they've done that.

        If shares close at $5.15 or $5.05 on March 22nd, I don't think this big buyer would be unhappy, because I don't think he plans on selling half a million shares onto the market that day anyway. This appears to be a buy and hold strategy. In fact, I think this person might exercise all of these options if shares close at $4.95....$4.90, $4.85 even.. I don't think there's any way they could pick up this many shares on the open market under $5.00. Should be intersesting.

      • Whoever bought the options is probably still smiling today....and still buying today....and will still be smiling in the future.

    • In addition over 1,000 April contracts traded. If someone big is trying to buy in, this is the easiest way to do so and not drive up the price, which would have happened if they had tried to buy 500,000 shares all at once.

      I imagine we close over $5.00 on March 22nd. Their break even may be $5.30 or so, but I imagine that isn't really the issue, I think whoever bought these up intends to exercise and hold the shares. They probably aren't so concerned with where the shares close on the 22nd. Again, this was just a quick way to buy a bunch without driving up the price a ton.

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