Vringo (VRNG) shares are up 14 cents to $3.52 and one player bought 700 Nov 6 calls on the New York-based app software developer at 2 cents and sold 700 Dec 3 – 4 strangles at 70 cents. The spread has traded 1400X and probably rolls a position from Nov 6 calls to a new position in the Dec 3 – 4 strangle. If so, it’s a bold move because the stock has been volatile lately on speculation of a legal settlement with Google and earnings come into play on Wednesday afternoon. 30-day ATM implied volatility in VRNG Dec contracts is about 125 percent ahead of the news. 30-day actual volatility is 243 percent.
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Frederic Ruffy is a well-known trader, writer, and strategist who has spent years educating investors and creating intelligent, insightful, unbiased market observations that are frequently cited by the Wall Street Journal and other financial publications. As senior analyst, Fred provides frequent and regular notes and daily updates for activity of interest.