Thursday, July 14, 2011

Petrohawk Pro Trading Review

If you haven't heard by now HK was bot out by BHP for $38.75.  Here are all my option flow recap notes on HK with links back to the original post.  I highlighted "stand out" trades and put comments on other trades. 


Feb 10th: HK – 20,000 of the June 30 calls were bought for $0.15. The bullish activity in the name comes the day after Encana (ECA) , Petrochina deal was announced.  (Stock was at $20 here and went to $27 in April.  Also important to watch names in sectors with M&A.  Clear winner)



Feb 11th: HK - The June 17 / 20 3x1 risk reversal traded 3000 x 1000. Buying 1000 June 20 calls and selling 3000 of the June 17 puts and collected .10.  (notice they did it for a credit.  Stock closed at 19.55 and ran to over $27. Winning!)


Feb 24th: HK – 20,000 January 30 / 35 call spreads were bought for $0.53 to open.

Feb 24th: HK – An investor sold 37,600 June 19 calls at  $3.71 to close and bought 47,000 June 21 calls for $2.53 to open. It appears to be a rolling up in strikes.  (stock closed at $21.59 and then traded as high as $27 in April. #WINNING)

March 4th: HK Petrohawk Energy Corporation- 10,000 January'12 25 / 35 call spreads were bought

March 7th: HK Petrohawk Energy Corporation 10,000 January’12 5.0 Puts were sold at $0.06

March 8th: HK Petrohawk Energy Corporation – 5800 June 18 Puts were sold at $0.39.  

March 10th: HK Petrohawk Energy Corporation – An investor sold 3000 of the March 19 calls and bought the January 25 / 35 calls spread 6000x.

April 4th: HK Petrohawk Energy Corporation – 20,000 of the June 35 calls were bought for $0.08. The calls were bought to open. The stock would need to rally over 44% for this trade to be profitable.  (stock closed at 24.30 and traded over 27 by the end of April) 

April 12th: HK Petrohawk Energy Corporation  17,650 of the September 30 calls were bought for $0.66.

May 4th: HK Petrohawk Energy Corporation – 10,000 of the May 26 / 29 call spreads were bought for $0.30. The call  spread appears to be opening.  (stock closed at $24 and pop'd $2 over the next few days)

June 13th: Petrohawk Energy Corporation HK – 10,000 of the September 23 puts were bought for $1.79. (The stock was down almost 2% on the day, closed at $23.67 and traded down another buck a week later.)

June 27th: HK Petrohawk Energy Corporation  – 30,000 of the January 21 / 25 bullish risk reversal was bought for $0.35. The trade was tied to 2.4million shares and was to open.  (most likely replaced stock with options for leverage... or could have rode the stock down for a scalp)


July 5th: HK Petrohawk Energy Corporation – 1250 of the August 27 calls were sold at $0.81. The calls were sold to open.  Trader selling new highs.  (Stock dropped $2 the next few days)


July 11th: Trade of the Day: PetroHawk Energy January $25/$21 bull risk reversal for a .77 debit. No one has any excuse to have missed this... 


Notice how much they loved the Jan's.  


Here's a great post by Joey @ Options Hawk for some some additional reading and option flow in the space.  I'd also suggest going over our option flow recaps and digging into the nat gas plays.... and watch for future clues from the option market on what the next winner will be. 




http://seaofopportunity.blogspot.com/ 


 *Special thanks to Option Radar, BMO Capital, MEB Options, LiveVolPro, CBOE, Option Monster, T.O.P. group, and all of the options desks and traders we work with to provide the option flow! 


 No position at this time. Position declarations are believed to be accurate at time of writing but may change at any time and without notice.

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