On December 22, 2003 our scanner picked up unusual option volume on the Jan 45 and 47.50 RIMM Call options. Somebody was betting large, and most likely with inside information (It happens all the time)...
A trader noticing this unusual volume (or someone using our options scanner) could have bought 30 contracts of the Jan 45 Call options on December 22, at $3.50 per contract for a total cost of $10,500.
The following morning, the same contracts opened at $13.60, and traded over $24 during that very same day. We 'could have' sold them easily at $20 per contract for $60,000... resulting in a net profit of $50,000, which is a 600% gain in 24 hours!
If you look at the actual option volume activity prior to and following the news release, these show the unusual option volume spike on the option chart, and the subsequent price spike the following day.
These show 600% increases overnight! (i.e., $3.40 options were worth over $24 the next day or $340 turned into $2400 per contract!)
On December 22, 2003, RIMM's Time & Sales shows the Jan 45 Calls closing near $3.50 on unusually strong volume. These options then opened sharply higher the next morning, and even traded as high as $25 in the following 2 days!
What's important to note, here, is that the options volume spiked unusually high the day before the news! (See the relatively large number of contracts being bought into the close compared to RIMM's normal option volume).
An astute trader (or someone using our options scanner) could have picked up on this unusual volume, and potentially made a huge trade.
Why am I telling you this?
Because sometimes, even when I see other peoples' earnings statements, I still don't find them to be 100% credible. Here, you can verify these results yourself...
And keep in mind, this is only one example of similar opportunities that you will find using our scanner!
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