Potash Options Rolls, Bullish Bias (POT)

Posted in General, Options 
September 19th, 2009

Potash Corp. of Saskatchewan, Inc. (NYSE: POT) saw not very unusual trading in the stock this Friday, but there were some options roll trades that went off that flagged this one for unusual options activity.  A screen showed that almost 50,000 contracts in all traded.  Here were the roll-out OCT-2009 PUT and CALL transactions.

CALL$    Volume    Op.Int.
95.00    1,223    3,284
100.00    5,985    14,361
105.00    2,127    8,357
110.00    4,885    3,585
115.00    2,405    2,487
PUT$    Volume    Op.Int.
85.00    1,042    8,851
90.00    1,429    3,371
95.00    3,678    2,187
100.00    1,332    1,460

The options bets for DEC-2009 do not look representative of ’someone knows something’ but they were one-sided bets with the volume in the CALLS being much higher than in the PUTS.  Some traders still expect a big merger in the fertilizer and potash space, although Potash Corp. has a market cap already near $30 billion.  Our guess is that if Potash Corp is in a deal of some sort, it would be By Potash rather than for Potash.

JON OGG

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