Options Spike: Washington Mutual (WM)

Posted in Options 
June 9th, 2008

Washington Mutual Inc. (NYSE: WM) has seen some unusual stock options activity in the last hour or so.  With the weakness in Lehman Brothers after its losses and $6 Billion financing and with everyone on Wall Street asking “who’s next?”, this one might not be that large of a surprise.  Here is the unusual trading with open interest (OpInt.):

CONTRACT                   LAST    VOLUME   OpInt
JULY-09 $12.50 Call    $0.10    27,075    43,608

It looks like a speculator is making a bet that the bad news in the financial sector is going to be a “we’ve seen the worst for now” by July, but that’s a hard one to call.  This could also just be a large hedge for a short sale.  WaMu’s stock is also active with almost 30 million shares having traded hands.

Jon Ogg
June 9, 2008

11:14 AM EST

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