Millipore (MIL) is offered $107/Share in Cash

Published on February 28, 2010

Millipore (MIL) is offered $107/Share in Cash

February 28, 2010

According to reuters MRK is buying MIL for $107 cash/ share. Congratulations to all OPNewsletter members or twitter reader those who played MIL directional speculative trade, a 3rd successful trade after PCLN and FSLR earnings play.  These are bonus trades that are not part of OPN performance calculation. For previous speculative trade’s results, pls click here.

If you would like to enjoy both from Income as well as speculative trades, pls sign-up for the OPNewsletter waitlist. Pls read subscriber’s testimonials that might help you understand more about OPNewsletter.

I have been updating in the OPDiscussion forum on how I was playing this trade. Here is the chronological order-

Feb 22, 2010-

There are two take over rumors CMC and MIL; rumors occur time to time; sometime true, at times not. You may want to assess and play accordingly. If you do decide, pls use only the money you can afford to lose 100% and sleep well…

disclaimer—I forgot to mention..I am in both as I do play rumors, over a long run it does payout [for me at least] CMC (Apr 15/17.5 Bull call debit spread) and MIL (Mar 90 calls)…and i may change/close anytime as well..

Then some OPN subscribers sold it for roughly 30% profits; I converted this into a backspread-

Congratulations, now selling for almost $3.90, that’s 80/310 > 25% for a short duration ..do keep in mind when do u want to get out; in order to lock my profit, I have converted this into a backspread by selling Mar 85 call for every 2 Mar 90 calls. btw, there were news yesterday—> A spokeswoman for Thermo Fisher Scientific (NYSE:TMO) said Monday afternoon that reports the laboratory-instrument maker has made a takeover offer for Millipore (NYSE:MIL) are “definitely a rumor,” according to Dow Jones Newswires.
http://www.mysmartrend.com/nw/19015

I don’t know who to trust now, bloomberg or this corporate…my bias though is for bloomberg Wink take care, rumor plays are not easy ones to digest.

And then I converted it into a reverse Christmas tree (Investopedia defines Christmas Tree strategy as one of option trading strategy that is generally achieved by purchasing one call option and selling two other call options at different strike prices. When drawn structurally, the strike price of the long option is located below the two successively higher written calls and loosely resembles a Christmas tree)-

And here is the confirmed news-
http://www.businesswire.com/portal/site/home/permalink/?ndmViewId=news_view&newsId=20100223007489&newsLang=en

Recall what did the spokeswoman said “definitely a rumor”… over a period of time I have come to realize to trust media more, for rumors, than to listen to corporate execs (but that’s just me)…

an update, I converted the backspread into a reverse “christmas tree” spread by buying more of Mar 95, also Mar 100s..net position as of yesterday close- for each 85 call sold (@$6), I bot 2 Mar 90 (@3.10), 3 March 95 (@1.75) and 2 March 100 (@0.85); so far the trade is doing good.

CMC is not doing that well, as of yet, but I didn’t increase my exposure on that as I didn’t see share price movement on the upside, I shall be waiting till today..if there is no move up..I’ll book the loss on this one and move on

Waiting for Millipore to open on Monday.  For OPNewsletter, as of last Friday close, we are up +2.5% on 62.5% capital investment (these results excludes gains on speculative trades like PCLN, FSLR earnings and MIL M&A speculative play).

If you would like to enjoy both from Income as well as speculative trades, pls sign-up for the OPNewsletter waitlist. Pls read subscriber’s testimonials that might help you understand more about OPNewsletter.

Profitable Trading, OP

One Comment

Leave a Reply

Facebook IconYouTube IconTwitter IconFollow Me on Instagram