The investment..speculation, out right gambling thread

Parent Cafe
4941

<p>Ooops….
[S.E.C&lt;/a&gt;., Suspecting Insider Trading, Freezes Account Over Heinz Merger - NYTimes.com](<a href=“http://dealbook.nytimes.com/2013/02/15/s-e-c-acts-on-suspicious-heinz-trading/]S.E.C”>S.E.C., Suspecting Insider Trading, Freezes Account Over Heinz Buyout - The New York Times)

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<p>Nov. 14, 2012 to Feb. 11, 2013: max HNZ call option contracts purchased is 61 on a single day
Feb. 11, 2013: zero HNZ June $65 call options purchased
Feb. 12, 2013: 14 HNZ Jun $65 Calls purchased
Feb. 13, 2013: 2,533 HNZ Jun $65 Calls purchased
Feb. 14: Buffet and 3G Capital announced a $23B takeover of HNZ</p>

<p>How do you talk your way out of this?</p>

4942

<p>You know…people do talk their way out of this.</p>

<p>I have seen quite a bit of insider trading over the years. Very, very little is caught, much less prosecuted.</p>

<p>By the way, there was large put buying too, correct?</p>

<p>The put buyers could have been buying the stock so the net position was similar to buying calls. No different than the trades you highlighted. </p>

<p>The put buyers should be looked at also. What looks like bearish bets were really bullish bets.</p>

<p>Like that info Krlilies.</p>

4943

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<p>“I found it on an internet message board”</p>

4944

<p>Yeah…</p>

<p>There were rumors…</p>

4945

<p>Hopefully, in Heinz, the relationships between the players will be too obvious.</p>

<p>Hmmmm…I thought there were more puts trading than what was mentioned in the article. </p>

<p>Anyway…that large trade in the 65 calls really does stand out…
What a lucky guess. :)</p>

<p>[UPDATE</a> 1-Bets on Heinz raise suspicion in U.S. options market | Reuters](<a href=“http://www.reuters.com/article/2013/02/14/berkshire-heinz-options-idUSL1N0BEBMR20130214]UPDATE”>http://www.reuters.com/article/2013/02/14/berkshire-heinz-options-idUSL1N0BEBMR20130214)</p>

4946

<p>I was wondering if any of the traders, services, or market gurus picked up on this. There are people that specialize in monitoring unusual volume (particularly options) as an indicator that something is going on with a stock.</p>

4947

<p>[SEC</a> sues over Heinz option trading before buyout - Yahoo! Finance](<a href=“http://finance.yahoo.com/news/sec-sues-over-heinz-option-015207505.html]SEC”>http://finance.yahoo.com/news/sec-sues-over-heinz-option-015207505.html)</p>

4948

<p>NJres, In our office, we had a system that would have picked up Heinz irregular option activity in real time.</p>

<p>I don’t think that many firms would pick this up, but some would. Maybe just a few…</p>

<p>This doesn’t mean anybody would have acted on this. A lot of irregular activity pops up.</p>

4949

<p>[Icahn</a> Using Options in Herbalife Salvo](<a href=“http://www.cnbc.com/id/100465961]Icahn”>Icahn Using Options in Herbalife Salvo) and [Hedge</a> Fund Manager Loeb Sells Part of Long Position in Herbalife](<a href=“http://www.cnbc.com/id/100466047]Hedge”>Hedge Fund Manager Loeb Sells Part of Long Position in Herbalife)</p>

4950

<p>That is not good if you want the short squeeze.</p>

4951

<p>I wonder how Icahn was able to buy those options? Did he buy the options from somebody long the stock? Did a brokerage firm accumulate the stock and then sell him the options? </p>

<p>Loeb’s actions do not help Icahn. If large investors sell out, a short squeeze is unlikely. In Loeb’s case, his actions don’t show long term conviction in the stock.</p>

<p>HLF closed weak on Friday.</p>

4952

<p>I don’t see anywhere where there are European style options on hlf - how did he do this?</p>

4953

<p>It was a private market transaction.</p>

4954

<p>so unless you are one of these guys - you’re not going to get these kind of deals.</p>

4955

<p>Definitely not getting this deal.</p>

<p>You don’t really need to though, do you?</p>

<p>You can call brokerage firms and ask for options tailored to you. Brokerage firms will do this for you. You are going to get ripped off. The volatilites are going to be off so the brokerage firm can make money. For example, if you have lettered stock…stock you can’t
sell until a specific date, you can have a brokerage firm set up a trade where you buy puts and sell calls that expire on that date. This cuts your risk of ownership while you are prevented from selling the stock.</p>

<p>The firms aren’t going to trade 5 lots with you. (At least, I don’t think so). Not worth it to the firms. The firms want to make money. </p>

<p>The firms that will do this trade…trade for themselves.</p>

4956

<p>not really but I thought selling european style puts was intriguing. I didn’t realize that I could do what you mentioned - of course why would I? I don’t have Icahn’s money, clout or stock market smarts.</p>

4957

<p>I got called out of T at 35, and TRV at 80 - no surprises there, but I have not gotten any notice on BAC - I am short calls with a 12 strike. It closed Friday at 12.02. I was short some out of the money calls on CAT and DE that were not even close.</p>

4958

<p>When you say you were short calls, does that mean you also owned calls or stock that you were long in, if not you’re very brave to short calls in bac at 12.</p>

4959

<p>NJres, are you going to try and buy those stocks back? Sell puts in those?</p>

<p>Those look like stocks you want for the long term.</p>

<p>Looks like those bac calls weren’t exercised. Those bac calls are automaticaaly exercised unless you request your brokerage firm not to exercise. I guess some traders requested the brokerage firms not too exercise those options.</p>

<p>What are you doing in IBM?</p>

<p>My short options expired worthless. I didn’t sell much for next week. I have my smallest position of the year coming into next week.</p>

4960

<p>^^same here since a number of my long call options expired yesterday. I’m going to have to see whether I get back in spy, bac, iwm. Tomorrow the market isn’t open and I don’t have work - not sure what I’m going to do with the time. I haven’t yet fully run my programs to assess my trading for last year.</p>