There is a huge disparity in the pricing of IronNet , IRNT. On the 10/15/21 expirations, the put options at the money or above have $6 to $7 higher time value then the corresponding calls. That's a huge disparity. In my experience, I have only found this to be true under two circumstances: 1. The stocks in a short squeeze. 2. Stockholders are about to get something like a dividend or something else big such that a call option is priced lower to compensate for what the stockholders are about to get. I don't see any evidence of a short squeeze, it's not highly shorted. It's not scheduled to pay a dividend that I can find. Does anyone know why this would be on IRNT? It's a huge opportunity for short box spread, unless I'm going to be blindsided by something I don't know. Thank you
I think I kind of figured this out. The average cost to borrow the stock is over 500% with limited availability. That sounds like short squeeze numbers. But the short selling statistics are very low. This an anomaly.
IRNT is very hard to borrow. If you are able to locate short stock, you will pay 760% as of this morning. This causes the puts to trade much higher, as people will pay up for synthetic shorts. If you sell a box here, you risk early assignment on your calls and paying this interest until you cover.