georgeemployee
- There was an unusual spike in options trading related to Cerevel Therapeutics (NASDAQ:CERE) days before AbbVie (New York Stock Exchange: ABBV) agreed to acquire the neurology-focused biopharmaceutical company for $8.7 billion in cash, Reuters reported on Friday, citing data from Trade Alert.
- After the agreement was announced in After trading on Wednesday, Cambridge, Massachusetts-based CERE closed ~11% higher than the previous session, adding to its ~42% gain over the last five sessions.
- However, according to data from Trade Alert, the stock's strong gains in previous sessions were accompanied by a notable increase in options activity. Cerevel (CERE) options trading averaged less than 320 contracts daily to about 51,000 contracts over the past three sessions.
- Call and put options allow investors the right, not the obligation, to buy or sell a stock at a certain price on a specific date.
- “This is 100% suspicious” Reuters reported, quoting Matt Amberson, director of options analysis firm ORATS, who added: “I'm almost certain this was driven by someone who knew.”
