Recent

% | $
Quotes you view appear here for quick access.

Cyberonics, Inc. Message Board

  • rusty7860 rusty7860 Jun 2, 2005 4:09 PM Flag

    Put Action Today

    Jun 27.50 - 5014 contracts
    Jun 30 - 4058 contracts

    This is not a good sign someone is betting on bad news.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • can't tell what it means.

      could be closing out some longs. it certainly traded as a spread since the low stock volume indicates that no one was hedging against it. probably just a firm crossing the order on the cboe.

      if someone "knew" something they wouldn't be trading a 2.50 wide put spread seven bucks out of the money. if delay, stock will not likely drop that much and if worse news, and you knew it, you'd just buy the at the money stuff and watch the stock drop to the teens. plus buying all those bigger delta puts would start the drop in your favor immediately.

    • "Jun 27.50 - 5014 contracts
      Jun 30 - 4058 contracts

      This is not a good sign someone is betting on bad news."


      The only problem is that those two strikes make a perfectly valid vertical spread that can be had for .20.

      For instance, people are paying $200 (per 10 lot) to make $2,500 should the stock fall below 27.5.

      That's a potential 1,200% return on relatively low risk.

      If only on of those contracts popped off, I would be more worried ... but it really looks like a spread arbitrage as the two do seem mispriced with relation to each other. That's a real good spread for .20.

    • Jun 27.50 - 5014 contracts
      Jun 30 - 4058 contracts

      This is not a good sign someone is betting on bad news.


      Bad news or no news, they are the same.

 
CYBX
69.95+0.86(+1.24%)Oct 16 4:00 PMEDT