i truly suck lately. http://www.elitetrader.com/vb/showthread.php?s=&threadid=125399&perpage=6&pagenumber=2 didn't get in....and i will continue to bitch about it
If Yahoo shares does not recover, Yang will be shown the door in about a year, then Microsoft will make another bid at $28, Yahoo wants $33, Microsoft says $31. Deal!
i think this goes hostile. yhoo probably gaps down to 20 and it will only be that high because people will believe MSFT is going to start buying on the open market. monday will answer some questions.
Don't bother kicking yourself You had no real edge in making the trade anyways Say you did end up buying the puts and making money Think long term. How does this trade help you become a better trader? It doesn't. It's just pure gambling - these merger situations are pretty unpredictable
So how to play Yahoo now, here is what big boys are going to do. BB's friends on the Street (like WB) will each buy up to 4.99% Yahoo shares starting on Monday. With enough shares to win a proxy battle, then they get rid of Jerk Yang in about year like the other co-founder, Microsoft will throw another ball at Yahoo, if successful everyone will be happy, if not they will dump those shares before Microsoft announces another give up, then round three... I think without WB, BB might just take the offer, but WB knows how to save Micrsoft a few B at the expense of small investors and speculators. http://biz.yahoo.com/paidcontent/080504/1_322961_id.html?.v=2
i am guessing you are a new trader. limited risk and very high downside. this is not pure gambling. this buyout scenario reminded me of LEND where you had a limited upside (the buyout price) but very big questions about whether or not the deal would go thru at the original price or collapse altogether. i made a good trade in that one....should have had more size but oh well. that one i was able to actually short the stock because there was no major risk of getting caught by someone else raising their bid price for LEND. in yhoo there was that risk so put options were the only real way to attack the trade. i couldn't decide how much i wanted to put on the trade or whether or not it would be a waste of money if the buyout scenario didn't play itself out before the options expired. oh well...