Wednesday, December 16, 2009
Trade Idea
C was oversubscribed by 17X in after hours today at $3.15. Tomorrow depending on how this is trading in normal hours after the news is digested I might sell some naked $3 puts for March. I feel comfortable that with that level of interest at $3.15 that a short-term floor is put it at that price.
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Hey Jason,
ReplyDeleteEverything I read this morning says that the offering was a week one for Citi.
I think that until they are completyly out from under the government, meaning that the government liquidates the shares that it is holding (which it planned to sell $5billion worth until the price came in much lower than anticipated) in addition to the TARP money that this is a very weak play and that there are better plays out there.
But if I did enter into a position, I would wait to see the stock find a base before selling any puts against it.
The reason I say that is it has been less than a buck and it is not far from their now. I just think that there are far better higher probabilitie plays out there.
But let me know what you end up doing.
Should've, could've, would've. Looks like the secondary price was a temporary floor. I don't remember what the $3 March puts were fetching that day but they are .06 now.
ReplyDeleteThe mark was $0.245 on the day of your post.
ReplyDelete