The market maker can sell the shares and pocket the
spread. Risk-free trade for him. If it is a put buyer,
then maybe they think LNG will collapse further. Either way,
the MM pockets the spread by buying/selling underlying shares.
this too took a drubbing, nice yield @ 8.56. I did brief
overview of some of their filings and headline disclosures.
now I have a headache and will await tomorrow to see what the
analysts have to say.
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That makes sense for the sellers, but aren't there buyers on the other end?
LNG
Posted by lessarda on 8th of Mar 2011 at 04:46 pm
The market maker can sell
Posted by darnelds on 8th of Mar 2011 at 04:58 pm
The market maker can sell the shares and pocket the spread. Risk-free trade for him. If it is a put buyer, then maybe they think LNG will collapse further. Either way, the MM pockets the spread by buying/selling underlying shares.
Got it -- the rise in premium could make the trade worthwhile playing both sides. Thanks.
Posted by lessarda on 8th of Mar 2011 at 05:05 pm
CQP
Posted by hazbin1 on 8th of Mar 2011 at 04:57 pm
this too took a drubbing, nice yield @ 8.56. I did brief overview of some of their filings and headline disclosures. now I have a headache and will await tomorrow to see what the analysts have to say.