APC – Anadarko Petroleum Corp. – Frenzied call buyers flocked to the independent oil and gas exploration and production company today on speculation Australian firm, BHP Billiton Ltd., may be interested in buying the company. Anadarko’s shares surged 5.1% to an intraday high of $51.29 in morning trading. Investors populating APC options today flooded September contract calls to prepare for the price of the underlying stock to continue higher ahead of expiration. Shares are likely to extend gains if additional takeover rumors hit the air-waves or if an actual bid is announced. Trading traffic is heaviest in September $55 strike calls where more than 9,000 contracts changed hands by 12:20 pm ET. At least 4,000 of those call options were purchased at an average premium of $0.51 each. Call buyers also picked up around 2,000 calls for premium of $1.01 a-pop at the September $52.5 strike, and scooped up 2,900 now in-the-money calls at the September $50 strike for an average premium of $1.85 each. Bullish sentiment spread to the November $55 strike where traders purchased approximately 3,000 calls for an average premium of $2.29 each. Options implied volatility, helped higher by unconfirmed takeover chatter, rose 11.9% to 51.43% in early-afternoon trading.
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