
Do options traders see a double for GE stock? Well, maybe not a double, but perhaps a gain of 40% by next year.
Do options traders sense a holiday massacre? There was a massive trade that went up on Vix options at the December expiry. Specifically, one customer sold 28,000 of the December 45-strike calls and then bought 56,000 of the December 60-strike calls.
When it was hovering around $4 bucks, the thought of Bank of America being a $30 stock seemed patently absurd. But that's exactly what one option investor is betting on.
It's been a tough day for stocks and for tech in particular. A firmer dollar, some lousy economic data, and a nasty semiconductor sector downgrade from Merrill are all weighing on the market.
Call it a game of follow the leader today. George Soros buys Potash shares and now everyone is clamoring to buy POT.
We've said it hundreds of time on the show before: Never buy out-of-the-money calls in hopes of a takeover. But with so much deal making going on, and so many days punctuated with takeover talk, the urge to merge may drive some options investors to reach out and buy those cheap calls.
