BVF – Biovail Corp. International – Call options on the specialty pharmaceuticals company are flying off the shelves this morning with the price of the firm’s shares currently up 3.70% as of 11:40 am in New York trading to arrive at a new 52-week high of $27.74. It looks like some 7,000 calls changed hands at the January 2011 $29 strike with one investor generating the majority of the volume by purchasing 5,000 calls for a premium of $1.40 each. The call buyer stands ready to make money if Biovail’s shares continue to reach new highs by January 2011 expiration. Profits start to accumulate for the investor if BVF shares rally 9.60% over today’s high of $27.74 to exceed the effective breakeven price of $30.40 by expiration day.
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Andrew Wilkinson is the senior market analyst at Interactive Brokers Group, where he provides daily commentary and analysis on U.S. equity options trading throughout the trading day. Andrew provides webinars designed to explain option-related trading scenarios covering futures, fixed income, forex and equities.
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