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Adobe Systems Inc. Message Board

  • optionman76 optionman76 Jan 15, 2010 2:40 PM Flag

    ADBE - AAPL takeover? Options Trade

     

    I couldn't resist...

    The same old rumor about AAPL taking over ADBE popped up again today. Out of sheer boredom I looked for some unusual order flow... And what do you know, I found some.

    The day's largest trades from 1/7/2010 for ADBE are presented in the article. Simply put, someone sold a risk reversal 6500x and received $0.03. i.e Sold July 32 puts @ 1.43 and used that to fund a purchases of Jul 42 calls for 1.40. This is obvioulsy very bullish (unless it traded with stock).

    I took a look at the Options Tab for several months to see if 6500 open interest (OI) is common. Lo and behold - it isn't. In fact, there is not a single line with OI greater than 2,574 in Feb, Apr, July, Jan 11, Jan 12 (other than the strikes in question).

    Just for fun - how does this trade look if ADBE is taken over for $50?
    Gain = 6500*100*{$1.43 + ($8.00 - $1.40)}
    = $5,219,500

    Details, prices, snaps on my blog here:
    http://livevol.blogspot.com/2010/01/aapladbe-takeover-rumors.html

    This topic is deleted.
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ADBE
63.22-1.17(-1.82%)Apr 24 4:00 PMEDT

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