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Obvious Insider Trading In Ann Taylor Options Ahead Of Earnings
At this point blatant episodes of insider trading are a weekly if not daily occurrence. While we still expect to hear back from our friends over at Mary Schapiro's woefully underfunded Syndicate Encouraging Corruption (SEC), regarding the previously disclosed insider trading in New York Bancorp, here is another one for Mary and her gray matter-challenged subordinated to mull, this time involving clothing retailed AnnTaylor.
From Bloomberg:
Trading of bullish AnnTaylor Stores
Corp. options surged to a 10-week high yesterday before the
women’s clothing retailer boosted its fourth-quarter sales
forecast today in an unscheduled release.“Either this was a very savvy investor or the information
was leaked,” said Frederic Ruffy, the senior options strategist
at WhatsTrading.com, a New York-based provider of options market
analysis. “The call buying was just a couple of hours before
the close yesterday.”Almost all of yesterday’s trading of 5,766 options giving
the right to buy the stock was concentrated in the March $15
calls, which closed at 45 cents yesterday. They more than
tripled to $1.65 today as the shares jumped the most in nine
months, adding 19 percent to $15.88 at 3:42 p.m. in New York.
With the options purchased at $0.45 and now trading at $1.65, every call attained a profit of $1.20, or roughly $690,000 on the total 5,766 call options purhcased yesterdaty.
Here is a chart demonstrating the highly abnormal trading patterin in ANN, which was very likely precipitated by a leak of insider information from the firm.
In reality, with a hearing currently proceeding in which Senators are trying to perpetuate the "legality" of gambling, front running and market manipulation (Senator Corker, we will have some talking points later, which while not as eloquent as those prepared for you by Goldman Sachs will hopefully provide some much needed deobfuscation), why would anyone be even remotely surprised that this kind of blatant insider trading is a daily occurrence. We hope the perpetrator of the alleged illegal trades is not punished, and instead is made into a symbol of just how broken this market is.
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never did hear anything about New York Community Bancorp....
the SEC is a fucking joke and makes FEMA look good.
Helluva job Mary Schapiro, you wall street shill.
Interesting they focused on March instead of
February which would have been more profit
if they were buying for this event. What if
the improved sales forecast is lipstick on
the pig and the call buying is for another
event which will occur later, requiring the
purchase of the further month?
Why should Mary give a damn? She wouldn't be caught dead at Ann Taylor.
just had a hunch trade.. nothing to see here . move along.
win a few lose a few.
Agree.....just move along....when insider trading moves into the daily routine mode, this is called " NORMAL ". Like the sun rising each morning.
Amusing to keep score, though.
The question is – what can we do about this sort of thing? Seriously – I have called the SEC on numerous occasions – and always get the same old shit answer. While we cannot comment on individual cases, rest assured that we are constantly monitoring these sorts of situations and will take action if any wrongdoing is discovered. Thank you for your call – is there anything else we can help you with? It would seem that it would be a VERY simple matter to deal with – surely they have account numbers and can trace these trades to someone – and from there find out if this person did in fact have any way of getting inside information. Seriously – it is not rocket science. My question remains – what can we do about it short of taking up arms and storming the SEC? I for one am tired of this manipulated piece of shit we call a “Free Market”. Been trading for over 20 years now – and every time you think it really can’t get any worse or more ridiculously manipulated – all you have to do is wait a day or two and there will be something even more blatant.
SEC is too busy downloading all that porn (someones got to do it).
http://www.washingtontimes.com/news/2010/feb/02/sec-workers-investigated...
Hmmm, SEC downloading PORN -
I guess these guys can actually say they are
"HARD" at work.........
Innocent until proven guilty, I say.
They were just trying to sniff out abuses in the snuff film industry.
Impossible to believe they would be so stupid with computer filters tracking their every click. Impossible.
LOL. I posted that in another thread this morning. I was looking for it to post here again, but you beat me to it. ..
Tyler, Tyler, Tyler.
You just don't get it, do you? There's no such thing as "insider trading" anymore. It's all part of the super secret Economic Recovery and Market Stabilization Act of 2008-2050 that was passed by Congress without Congress actually being present. Don't you remember the memo?
Get with the program Dude.
+1
That silly Tyler is just mad that we made off with all the taxpayer money and he didn't get any. Better luck next time, puny mortal. I and my fellow banker demigods shall return to the mother ship to enjoy all the wealth we confiscated from you with the complicit acquiescence of your flaccid earth government.
Ignignokt out
Wait, how does ~1 dollar per option, under 6k options turn into 2/3rds of a million dollars?
Price is quoted at 1/100th (each call = 100 shares). To buy 6k calls at $.45, you lay out $270k. When you sell at $1.65, you get back $990,000...
1$ per share = 100$ option * 6 K options = 600,000
Prices are quoted per share, volume is in contracts. Contracts are for 100 shares. 6000 contracts times 100 shares times $1/share is $600,000.
SEC guy #1: "Hmm. Zero Hedge is finding some interesting stuff. I don't quite understand it, but maybe we should look into it."
SEC guy #2: "Say, that is kind of fishy. Maybe it's time to get Mary on the phone and.... Oops, lunchtime!"
SEC guy #1: "Mmmm, I vote for teriyaki!"
Control of SEC ops must have been one of the concessions to Wall St to convince them to not completely nuke Main St.
Now all your regulator are belong to us. Beotches.
It was me that bought the options. Every last fucking one of them. Chalk it up to smart money, Tyler. Nothing illegal here. I have this 6th sense thing working for me. I'd write more, but I'm heading to Cabo for the rest of the year. Hasta la vista.
The solution is simple. Pull your liquidity until the SEC grows some stones. The show is as much fun to watch as it is to play. Think of it like TV.
So called YOUR liquidity is about 5% of the market. Do it, tell everyone to pull it out. See if it has any effect. Ding dong.
All these sap stories about people making money is great entertainment. Thats the way system is, was, will be.
SEC only cares about catching OUTSIDERS doing insider trading.
That is, if someone report that you traded 500 shares of WXYZ on insider information, they want to procecute you.
But if you trade billions and front-run all the retai customers, that is quite alright. In fact, we encourage it.
Syndicate Encouraging Corruption (SEC), indeed.
SEC only cares about catching OUTSIDERS doing insider trading.
That is, if someone report that you traded 500 shares of WXYZ on insider information, they want to procecute you.
But if you trade billions and/or front-run all the retail customers, that is quite alright. In fact, we encourage it.
Syndicate Encouraging Corruption (SEC), indeed.
This is what the U.S. SEC spends their day doing...Seriously.
http://blogs.wsj.com/law/2010/02/02/the-secs-latest-crackdown-on-sec-wor...
Frankly,I am amazed at the silence of mutual funds,which is the only entity that can do something. they are "entrusted" with people's money,and they are big enough to have influence. But the problem is that they don't have a collective representation, whereby they can demand action under the threat of boycotting the market. I mean I can understand their reluctance to get involved in corporate governance since it is not their individual money that they are managing,but they can certainly demand a market free of manipulation. But then again,since it is not their money,and managers make millions anyway,why should they care?
Look at PFE today and all the calls bought! Different day, same corruption.
The SEC is not interested in busting just anybody it has to be the right person i.e. Martha Stewart . Jesus what a catch. Huge Bust. Meanwhile they were handed Bernie Madoff with pages and pages of proof and they ignored it twice. They are bought and paid for like the others.
who sold the calls ?
note : Bloomberg +1 ^^