Thursday, August 23, 2012

Vringo, Inc.(AMEX:VRNG) Witnessing Large Out Of The Money call Option Activities

Irrespective of the fact that the shares of Vringo, Inc.(AMEX:VRNG) have soared 275% so far this year, option traders are making bullish bet on the stock majority of the buying are witnessing for the November expiry.

The company had sued Google earlier this year calming that the later has infringed its patents related to sorting ads based on click-throughs. Both the companies are scheduled to present their views on October 16.

Considering the above scheduled event, option traders are bullish on VRNG and made several call buying for Nov 17. The most active contract was $5 strike price which traded 690 contracts and open interested stood at 18694. Also, 594 contracts were traded for strike price of $4 with open interest of 4249.

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Interestingly, few highly bullish traders bought a total of 322 contracts and 330 contracts for Nov $9 calls with premium price of $0.55 and $0.45.

Usually out of the money call buying is a very bullish bet and considering the latest activities, seems like traders are expecting VRNG to win the case against the search engine giant and earn maximum profit from their bet. However, if the VRNg losses the case, those option traders have limited their loss to the premium paid.

Shares of VRNG was down  0.80% to $3.72 on Wednesday after surging over 9% in Tuesday’s session. The stock was trading less than a dollar in January.

Earlier this month, AOL settled with Vringo's I/P Engine in the same court. I/P Engine is a company that merged with Vringo earlier this year.

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