Amarin Corp Plc (AMRN)

[KCSVEN]

I don't see anything concerning, Most of open interest were bets before results, recent volume seems to be hedging or straddles and mainly option plays on volatility and not on any news event. Seems hard to believe someone has some inside knowledge of black swan event that could drive the price down huge yet at the same time the general market had nobody aware of this.

If you have the funds selling puts AND calls makes a lot of sense right now, if afraid of BO risk then cover the sold call but high premiums still there for volatility.


Personally I sell options, rarely buy but these volatile stocks, while they are being volatile open up lots of potential options.


E.G. if bullish Sell Feb 14 Puts for $1.70, buy Feb 22 Call for 1.65, stock breaks to new highs by then, say with submission to FDA and FDA says will expedite, stock hits $25.30 you just doubled your money on call and made 1.70 on the Put. Odds of stock being below 14 I think are slim but if it does end up there you own the stock at $13.95 (14 minus the 5 cent profit on options sole/bought), you can then hold the shares or sell covered calls at 14. Odds are high you will make money even if it is only the 5 cents.

There are a ton of ideas you can do if you are bullish, bearish or neutral but the key is having high volatility so the time portion of the option is worth a lot in a short period. Not unusual to see high option activity in a stock that is so volatile recently.