maybe not quite as stupid as you if you dont sell soon-
By ANDREW ACKERMAN CONNECT
WASHINGTON--The Securities and Exchange Commission has frozen the assets of a group of unnamed traders who earned $4.6 million in potentially illegal profits by trading Onyx Pharmaceuticals Inc. ONXX -1.52% before the cancer drug-maker rejected an unsolicited acquisition offer from rival Amgen Inc. AMGN -0.26%
The SEC said late Wednesday it had successfully obtained a court order to freeze the assets of the unidentified traders who purchased risky call options in the three days before Onyx's Sunday announcement that it had received but rejected Amgen's offer and was putting itself up for sale. The $4.6 million in profits were based on an investment of just $305,000.
In a release, the SEC said the size and timing of the options trades "were highly suspicious because they constituted large increases over the historical volume for those call options purchased."
The SEC believes that the traders were in possession of material, nonpublic information about the offer to acquire Onyx at a substantial premium over the stock price. The options gave the traders the ability to purchase Onyx shares at a pre-set "strike" price of between $80 and $92.50 per share, options that dramatically increased in value after the company announced it was rejecting the unsolicited offer. Its stock surged Monday, closing at $131.33, 51% above its Friday close.
In court documents, the SEC said the traders used accounts at Citigroup Inc. C -1.00% (C) and Barclays BARC.LN +4.26% PLC (BCS), and said the traders or their accounts are located in the Canary Islands and Beirut.
"This action demonstrates that the SEC will not hesitate to freeze the assets of suspicious foreign traders when the timing and size of their trades indicate that they were misusing inside information," said Michele Wein Layne, Director of the SEC's Los Angeles regio