Frenzied volume Friday in LinkedIn Corp. options before its acquisition by Microsoft Corp. reflected spread trades that probably ended badly for their owner. About 2,200 lots that changed hands in four series of out-of-the-money puts and calls Friday appeared to have been legs in a strategy known as a “broken wing iron condor” that would’ve lost money after LinkedIn surged 47 percent Monday, according to Jim Smith, an options strategist at OTR Global Trading LLC. What ties the positions together is their timing: four trades -- two each of 600 bearish puts and two of 500 bullish calls -- all occurred at 1:40:39 p.m. on Friday. The hodgepodge of bets represented by the package, in which some contracts were sold, others bought, resulted in a profitability threshold that couldn’t withstand Monday’s rally, Smith said.
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