Keryx Rises With Hopes About Cancer Drug
The bulls were all over Keryx Biopharmaceuticals and AEterna Zentaris Monday amid optimism about their Perifosine drug.
Financial news website Seeking Alpha said Friday that the market hadn’t realized the potential for the cancer treatment, and both stocks began the week with a bang. In the case of Keryx, someone apparently liked the news enough to sell 6,500 March 4 puts . Those were essentially insurance contracts on the stock price, so selling them represented a vote of confidence.
Traders also bought callsat the March 5, 4, and 3 strikes looking for upside, according to OptionMonster’s real-time tracking systems. Those calls lock in the price they need to pay to purchase the shares.
Keryx closed the session up 33.51 percent to $4.94. More than 51,000 options traded in the session, compared with a daily average of about 3,000.
AEterna Zentaris also rallied 22 percent to $2.14, but doesn’t trade any options.
—Najarian owns KERX call spreads.
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Jon ‘DRJ’ Najarian is a professional investor, CNBC contributor, and co-founder of OptionMonster.com.