Lehman Bros - Cap. Trust IV - Pref''d Series "L" (LEHLQ)

[slimugrian]

Wow, this is serious stuff. Someone bought a serious insurance policy or placed a bet that Barclays SP will fall thru the floor. That someone has to have deep pockets:

MAR 11 put/strike 17$ ca 40'000 contracts (1 contract = 100 shares) with aproximate price 1,8$. 40'000x100x1,8 = 7'200'000$

MAR 11 put/strike 18$ ca 42'000 contracts (1 contract = 100 shares) with aproximate price 2,4$. 42'000x100x2,4 = 10'080'000$

MAR 11 put/strike 19$ ca 40'000 contracts (1 contract = 100 shares) with aproximate price 3,1$. 40'000x100x3,1 = 12'400'000$

MAR 11 put/strike 20$ ca 34'000 contracts (1 contract = 100 shares) with aproximate price 3,9$. 34'000x100x3,9 = 13'260'000$

GRAND TOTAL 42'940'000$ position. If that position was bought to protect real stocks on options buyer account then the position must be at least (40'000+42'000+40'000+34'000)x100= 15'600'000 shares wich are worth today 15'600'000x16,50=257'400'000$. There are several institutions owning this kind or bigger position of BCS shares. So spending ca 43 million dollars to protect your position seems ... odd, but understandable.

If these options were bought not to protect real stock position but to profit from falling Barclays shareprice, then ... I better not go there ....... To my knowledge there is only one event that can affect BCS SP that dramatically between today and March 17-th 2011.

In both scenarios that buyer is seriuosly doubting Barclays 16,50$ SP holds.

What a lovely Monday :)