Author Topic: Immunomedics Risk Arb  (Read 2712 times)

boilermaker75

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Re: Immunomedics Risk Arb
« Reply #10 on: September 14, 2020, 03:01:45 PM »
I took more risk and wrote the 2023 puts at 65 strike. What you're doing might be the smarter play in that you get value for the theta (time decay) and can end up in the same spot while rolling over every week, versus I get stuck.

And even better may be writing the higher strike puts when they're available like you said.

I think we will both do all right!


boilermaker75

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Re: Immunomedics Risk Arb
« Reply #11 on: September 15, 2020, 06:38:59 AM »
wrote some 80-strike, sept 18 expiration puts for $0.50 per share.

edit: and then some 75-strike, sept 18 expiration puts for $0.55 per share.
« Last Edit: September 15, 2020, 06:48:05 AM by boilermaker75 »

ander

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Re: Immunomedics Risk Arb
« Reply #12 on: September 15, 2020, 07:08:00 AM »
I wrote some 80 strike sept 25th expiration puts for $2.00 per share.

boilermaker75

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Re: Immunomedics Risk Arb
« Reply #13 on: September 15, 2020, 07:09:51 AM »
I wrote some 80 strike sept 25th expiration puts for $2.00 per share.

Nice, much better idea. 2.5% return in 10 days.

ander

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Re: Immunomedics Risk Arb
« Reply #14 on: September 15, 2020, 07:18:20 AM »
Thanks. Luck as the bid / asks are wide and moving around. (and hopefully good luck -- barring some left tail risk and deal blows up!).

writser

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Re: Immunomedics Risk Arb
« Reply #15 on: September 15, 2020, 07:28:47 AM »
What's our edge here? How do we explain the current spread?
I'm sorry if I have offended you. Please contact this forum's safe space coordinator to work things out.

@thewritser

boilermaker75

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Re: Immunomedics Risk Arb
« Reply #16 on: September 15, 2020, 08:48:37 AM »
What's our edge here? How do we explain the current spread?

I do not know, other than the uncertainty of dealing with pharmaceuticals?

boilermaker75

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Re: Immunomedics Risk Arb
« Reply #17 on: September 15, 2020, 08:53:45 AM »
I wrote some 80 strike sept 25th expiration puts for $2.00 per share.

Nice, much better idea. 2.5% return in 10 days.

I was able to write some of these this morning for $1.85 per share.

I am done for now. At least till some of the puts I wrote expire this Friday.

Gregmal

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Re: Immunomedics Risk Arb
« Reply #18 on: September 15, 2020, 12:08:12 PM »
I did a few of these as well. Thanks guys. Keep the ideas coming here.

ander

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Re: Immunomedics Risk Arb
« Reply #19 on: September 16, 2020, 11:51:11 AM »
What's our edge here? How do we explain the current spread?

Spoke w/ a merger-arb investor. He stayed away b/c of big premium 100%+ and it's biotech, so too much risk. He's not able to get up to speed on it since it's biotech and he does not have domain expertise (similar to most merger-arb guys). My guess is if it was a 20% premium then merger-arb guys could get comfort with the downside being lower. Here they assume that the downside is back to where the price was before deal was announced. However, on CNBC GILD CEO said there was a bidding war and process had been 2 months so unlikely it would go back to that level.

« Last Edit: September 16, 2020, 04:04:31 PM by ander »