Anavex Life Sciences Corp (AVXL)

[BAR123]

So as a follow up on the options question from Xena. There are now 1,930 contracts of the July 10 strikes in open interest. Either someone put down $20K yesterday to buy 510 of them in hopes that the stock will be well above $10 or they wrote covered calls meaning they collected $20K and they will lose the stock if it goes over $10 or if under $10 they just keep the premium.

I believe that someone is betting they stock will be close to $15-$20 by the third week in July. If they were writing covered calls why risk losing your shares at $10 when the big pop to much higher pps is coming. If you own or control 510 contracts ( like the one person did yesterday ) it means that if you were writing covered calls you have 50K shares in hand. Why risk losing them for .40c. Or you are just buying calls for .40c and now control 50K shares that you can that you can buy for $10 or if the stock goes to $20 by expiration those 510 contracts would be worth $500,000. Not a bad bet for only plunking down $20K.