The Big 2011 Yahoo! Options Bet (YHOO)

Posted in Options 
November 20th, 2009

Yahoo Inc. (NASDAQ: YHOO) has seen a massive trade for January 2011 as 20,000 January $12.50 puts are sold for $1.10, and 20,000 January $17.50 and $30 calls are also sold for a total of $1.75, while 40,000 of the $20 calls are bought for $0.96, a net credit trade.  The 4 legged trade could be tied to a block of 525,000 shares that also traded, but the options trade is betting on shares remaining between $11.60 and $18.40, but also has unlimited profits on a move above $21.60 (likely in case of a takeover).  Shares currently trade at $15.50.

Joe Kunkle,

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