Option special situations (no earnings before expiry)

J

just21

USG Seems to be an asbestos hearing on the 12th of May. Credit spreads still have some premium for May expiry. Any thoughts?
 
My first thought is to say to avoid. After that, there is always the butterflys. However, there doesn'y seem to be enough volume to leg into one for a good price. My last thought would be to sell the May/June 45 time spread. The vols across months seem close and you'll make money on the vol implosion. Are you sure this is why there pumped, because of this one day?
 
Looking at the IV skew it doesn't look like it is all tied up to May 12. Jun options have the same IV as May, which wouldn't be the case if May 12 was the key date..
 
It is in an uptrend so I sold the 30-27.5 bull put spread for .25 credit. It's below support. Other opps coming up are CYBX and AX. Any thoughts?
 
Quote from MTE:

Looking at the IV skew it doesn't look like it is all tied up to May 12. Jun options have the same IV as May, which wouldn't be the case if May 12 was the key date..
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Yes, I'll stick with my first option, the nothing spread.
 
Quote from just21:

It is in an uptrend so I sold the 30-27.5 bull put spread for .25 credit. It's below support. Other opps coming up are CYBX and AX. Any thoughts?
More...

CYBX May IV is 20 pts higher than June, which means that something's up in May.
 
Quote from just21:

It is in an uptrend so I sold the 30-27.5 bull put spread for .25 credit. It's below support. Other opps coming up are CYBX and AX. Any thoughts?
More...

Sorry, but I hate this trade. Risk is 9 times reward. Even if the asbestos bill gets passed, I think the news is already priced in. I'd love the bill to pass, and USG to gap way up. That'd be a sweet short.
 
Quote from Rearden Metal:

I'd love the bill to pass, and USG to gap way up. That'd be a sweet short.
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Shorted the living shit out of USG when the news broke, and loving every second of it so far...
 
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