Small personal aside before I talk shop: yesterday, I went to Pavillon de la Grand Cascade for lunch and had an amazing 8-course meal with my mom and grandparents. The meal was incredible, truly haute cuisine. Then I came home and had a very happy GDP day - all of my stocks were up, and my entire portfolio jumped 23%, again, mostly due to ABK.
Good time for selling covered calls. I sold some SLM October calls with a strike of 20 for $0.45. I am ready for a big upswing, but at the same time, I recognize that another 20% rise by then would be a huge move for SLM. I hope that they will report earnings after my calls expire, but I do not have a problem with buying back if earnings are earlier than I assume.
I also sold some BBX September calls with a strike of 2.5 for $0.1. Free money.
I cannot take credit for this idea, but it is a good one:
MetLife (MET), the insurance giant, is doing a voluntary exchange offer in which holders of MetLife stock can tender in their shares to receive shares in a publicly traded subsidiary called ReInsurance Group of America (RGA). MET is doing this to distribute its 52% interest in Reinsurance Group's B shares (which currently are not listed). You can find official details of this offer at the information agent's website at http://www.dfking.com/metlife To encourage participation in the exchange offer, MetLife is going to give holders of MetLife stock the three day volume weighted average price of MetLife stock + 11% of value of the three day volume weighted average price in Reinsurance group class A shares. So just as an example if the VWAP price for both stocks were $50, you would receive 1.11 shares of RGA.B for each MetLife share tendered into the offer. Subject to a limit of 1.3071 shares of RGA.B for every one share of MET.
This offer has an unusual provision for odd-lot holders. If you own less than 100 shares of MET, you will not be prorated should the offer be oversubscribed. It is safe to assume that giving a free 11% premium to rational stockholders will result in oversubscription.
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