Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

9 Weeks to Better Options Trading: Special Situations: Earnings Reports, Takeovers, and Extreme Market Moves

By

Veteran options trader Steve Smith breaks down special situations.

PrintPRINT
Mergers and Acquisitions

Mergers, both real and rumored, may be coming back in vogue, providing not only a catalyst for stock-price movement, but for an increase in option activity. While overall M&A volume is near three-year lows, there are signs that with healthy balance sheets, low interest rates, and a slowly returning sense of confidence, we might expect a dramatic pickup in activity in the second half of the year

According to PricewaterhouseCoopers, as of the beginning of 2012, US corporate balance sheets had over $1.4 trillion in free cash, while private equity firms held in excess of $1 trillion in uncommitted capital. Last year, we saw a string of strategic corporate mergers, especially in technology, as firms like Intel (NASDAQ:INTC), Hewlett-Packard (NYSE:HPQ), and Amazon (NASDAQ:AMZN) gobbled up young companies for huge premiums, handing out big profits for those that found themselves sitting on out-of-the-money calls. These land grabs are hard to predict and, Facebook-for-Instagram notwithstanding and unplayable anyway, they have somewhat subsided of late.

No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

PrintPRINT

Busy? Subscribe to our free newsletter!

Submit
 

WHAT'S POPULAR IN THE VILLE