Is this the volatility play of the week?
I bought a synthetic straddle before market close. Delta neutral long stock, long Jun 30 puts at 1.70. iv only about 75%.
The story goes they have a cancer drug that they are releasing study efficacy data for ASCO for Monday. If the drug competes well with PFE's product, stock goes up. If its a disappointment, it looks like there's quite a bit of downside.
Looking at liver cancer mortality rates, it seems a drug like this could command a decent premium.
http://www.cancer.org/downloads/stt/CAFF06EsCsMc.pdf
Since Bayer has some connection with this company, yahoo message board fantasizers dream of a Bayer buyout upon hearing good data at double the current price.
Looking at historic volatility on this stock, I don't see the IV collapse risk breaking the incentive to take this trade. All I need here is a few dollars either way. Something gigantic would be a dream.
Included is a chart showing implied volatilities over the past year.
I bought a synthetic straddle before market close. Delta neutral long stock, long Jun 30 puts at 1.70. iv only about 75%.
The story goes they have a cancer drug that they are releasing study efficacy data for ASCO for Monday. If the drug competes well with PFE's product, stock goes up. If its a disappointment, it looks like there's quite a bit of downside.
Looking at liver cancer mortality rates, it seems a drug like this could command a decent premium.
http://www.cancer.org/downloads/stt/CAFF06EsCsMc.pdf
Since Bayer has some connection with this company, yahoo message board fantasizers dream of a Bayer buyout upon hearing good data at double the current price.
Looking at historic volatility on this stock, I don't see the IV collapse risk breaking the incentive to take this trade. All I need here is a few dollars either way. Something gigantic would be a dream.
Included is a chart showing implied volatilities over the past year.
