GNTA high IV

Quote from marc6001:

Mav,

Would you agree that because we're using front month options (t <= 30 days) where vega and gamma are low especially for ITM and OTM strikes IV movement (up or down) will have minimal impact on the position? The concern would be the effect of theta decay.
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Theta decay is a non issue on deep ITM options. That is why I said the backspread is good for explosive moves. I am making the assumption here that when I say explosive, I mean that you expect your long options to be deep ITM.

If you are expecting a small move to the long strike then this is not the optimal strategy. In that case you would want to have a short backspread where you are long the ATM and short two OTM strikes where the stock closes at the short strike. Do you follow? However, it's safe to say when playing FDA news that the reaction will be very binary in nature and it's almost a given that the stock will double or get cut in half at least with small and midcap biotechs. For reasons that I'm sure are obvious to you.
 
Quote from Maverick74:

OT: why are all you tools home on a Saturday night? Virtuoso and Mav sitting in front of the screen drinking a diet Coke and eating a Hungry Man(gay innuendo).

At least I've got the cast-iron bitch to which I'm hitched. Sh*t, even she let's me out on occasional Saturday night...

:D
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Quote from AAAintheBeltway:

I read the FDA summary that you linked and it sounded pretty darn negative to me. Of course, they didn't say the drug killed all the participants, I guess that would have been more negative. As I read it, basically there was some minimal positive response but nothing outstanding.

I wonder when that FDA summary was posted, because the stock dropped a lot after it appeared here. Of course, that might have been riskarb bailing...;-)
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AAA, I'm glad to see you are still here (ET). So many people seem to hang here briefly and fade into oblivion.

:)
 
I spoke the other day with a family member who has been a healthcare lawyer for the past ten years and works in-house for a fortune 100 pharmaceutical company. She works on various FDA processes among them, drug applications. In her opinion, based on the briefing posted by the FDA (she has no other knowledge of this drug or company, just going off the documents) the drug would not get the nod on this go around. It's not dead, but it isn't getting approved today. Take that for what you will.
 
Quote from Ikspec:

I spoke the other day with a family member who has been a healthcare lawyer for the past ten years and works in-house for a fortune 100 pharmaceutical company. She works on various FDA processes among them, drug applications. In her opinion, based on the briefing posted by the FDA (she has no other knowledge of this drug or company, just going off the documents) the drug would not get the nod on this go around. It's not dead, but it isn't getting approved today. Take that for what you will.
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Some interesting posts on the ALTH Yahoo board from a guy at the meeting. He's been posting real-time updates for the last hour or so. Evidently, the patient statements just concluded and the vote is now imminent. So we should soon know one way or the other.
 
Yeah. She said that if it were to get approval it'd be likely on the basis of there being no alternative treatments at the moment, but if she had to wager she'd go with a nay.

Then again she keeps reminding me the FDA process is inherently unpredictable and that she wouldn't wager. She'd probably make a better trader than me ;)
 
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