Since the Alibaba announcement, I have been writing out-of-the-money calls (either 62.50 or 65) and bringing in very nice premiums as the stock bounces between 55 and 60. But now I notice HUGE open interest in the September and December 70 and 85 calls.
Can anyone explain what is going on and what the strategy is???
I invested in SINA a few years ago and it ran to 140 . The run was based on a story that they were close to monetizing WIEBO. This didn't happen and the stock crashed. I lost a little bit but never took the stock off my watch list. 2 years later I hear that very same story starting to play out. I think the analyst's were early. The story is starting to play out exactly the way they predicted two years ago. I see SOHU climbing faster than SINA but I am trying to stay diligent and have been investing in SINA. I am one of those people that have investing in Sept 2013 Calls , but have dollar cost averaged into the stock as well. No one can predict the future but I believe that this is one of the best play's out there and with all the macro it gets difficult to stay the course.