by Houghton and Atkeson 08/19/08
On July 2, NVIDIA Corp's (NVDA) stock halted at about $18 per share. With the stock stuck, the management preannounced lower earnings and disclosed taking a charge for anticipated customer warranty, repair, return, replacement and other possible costs from its product failures in notebook computers.
Over the next weeks and months, the stock moved to a new 52-week low of $10.55. Since hitting that low, the stock has begun to show some life and is now trading in the mid $13 range.
Today, option investors are buying more than 12,000 NVDA Sept 15 Calls (UVAIC). This follows a similar purchase of 10,000 Sept 15 calls made last week.
There has been a lingering rumor that Intel (INTC) may have an interest in acquiring the company. It appears some option investors are willing to bet this unsubstantiated rumor might prove to be correct.
Ready to get in on the big-money options trading action? Sign up for your risk-free trial to Nick and Andrew's Big Money Options service, which gives you 2-3 specific trading recommendations a week, delivered by e-mail, PLUS timely profit alerts and trade updates.
Dawn Pennington
Read This Before You Buy Another Stock
A savvy stock position can start with a single options trade.
This technique can help you breathe a sigh of relief as it aims to relieve a 'choking' portfolio.
If you are familiar with buying calls and puts, we'll show you how to buy them even cheaper.
Anatomy of a Stock Option Ticker
Option tickers may look like a bowl of alphabet soup to you, but each letter means something.
You don't have to short stock to put a bearish bet on the table -- but the path to profits comes with different levels of risk.
