Wednesday, May 22, 2013

Saks Inc (SKS) - Cheater or Shrewd Trader? 600% in 29 seconds.

SKS is trading $15.67, up 14.6% with IV30™ up 40.6%. The LIVEVOL® Pro Summary is below.


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Saks Incorporated is a department store retailer. The Company, and its subsidiaries, is engaged in the operation of Saks Fifth Avenue (SFA) stores and SFA e-commerce operations (Saks Direct), as well as Saks Fifth Avenue OFF 5TH (OFF 5TH).

This is a very quick note on some suspicious trading... By suspicious I mean thousands of call purchases in the front month 30 seconds before the close yesterday. And I do mean literally 30 seconds before the close.

Many thanks to Doris Frankel from Reuters for the heads up on this one.  If you don't follow her, you are missing out.  For that matter, the same goes for Cecile Vannucci, Nik Gammeltoft and Jeff Kearns from Bloomberg and Kaitlyn Kiernan at Dow Jones.  You should be reading their stuff daily IMHO.

First, the news moving SKS:

Saks Inc. shares surged 14% to $15.58 on Wednesday after reports surfaced late Tuesday that the high-end department store chain has hired Goldman Sachs to explore strategic options, including a potential sale.

Source: MarketWatch via Yahoo! Finance: Saks explores a sale; how much is it worth?, written by Andria Cheng.

OK, here's the pre-market close trading from yesterday in the Jun 13 and 14 calls. Note the time stamps (EST):

Uh huh....

And here is the Options Tab right now.

So the June 14 calls went from $0.30 to $1.85 and the Jun 13 calls went from ~$0.85 to $2.70.  That's more than 6x and 3x the purchase prices, respectively purchased 21 seconds pre-close in the Jun 14 calls and anywhere from 31 - 50 seconds pre-close in the Jun 13 calls. OK...

The question remains, was this a cheater or a very shrewd trader that was reading the headlines and digesting them faster than everyone else?  Usually when I ask that question I'm being facetious, this time, I actually mean it -- it's ambiguous.  Check out the news from the NY Post -- their website has a story posted 3 min after the close yesterday... Hmmm...

UPDATE: It looks like the NY Post did tweet a message with the news 8 minutes before the close, so this was in fact a shrewd trader. Very well done and very legal.

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Legal Stuff:


  1. The story was tweeted by the NY Post reporter at at 3:51PM ET before it was published at

    Charles Gross