Traders also speculate on the direction of stocks in the emerging and developed worlds.
Dynegy: The announcement by Blackstone Group that it was making a $4.50 a share bid for the power generating company created a groundswell of demand for shares in Dynegy, which rose 60% to just pennies short of the deal price. Options volume quickly eclipsed the overall reading of open interest at Dynegy when two tranches of 10,000 lot call options were scooped up by speculators wondering whether there was more upside juice for its stock price. An investor had no second thoughts in paying 50 cents for 10,000 calls expiring in September granting the investor buying rights at a fixed $4.00 per share.
Why ride a bike 2 miles to work and deal with sweat when you could drive in a nice air-conditioned vehicle?