Ok. So the game appears to be afoot again.
There are reports from multiple sources that the $YHOO board will meet again today to consider a deal for Asian assets.
People get excited every time as evidenced by price and volume spikes but as I have said, leaks to the media in these situations do not occur by accident. They occur because one party wants to try to influence other parties.
So gleaning information from the news articles written every time is akin to the Charlie Brown trying to kick Lucy’s football. What a tease that Lucy…
This is why I sell covered calls (more recently on only half of my long position) when this occurs. Yesterday, someone bought JAN 17.5 calls from me for .4 on half of my position.
With the stock near 16 off the spike, that was 2.5% for an option 9.5% out of the money with 20 trading days until expiration. And so I am capped at 17.9 on half of my shares until January 21st.
Think about that for a sec and then check out the chart below and you can see the opportunity to enhance yield (or lower basis) on each rumor mill cha cha cha…
One of these go rounds there will likely be credence to reports and it may very well be Xmas 2011 (w00t!) but there is no way of knowing which time and at what price.
None.
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