This company has issues. It's association with John Kapoor doesn't help matters. Anytime now, the judge should deliver his decision regarding the merger drama. Based on price and chat, many are expecting the verdict to favor AKRX
. Who knows. The possible verdict outcome could be merger proceeds at original terms, proceeds at a reduced price, or Fresenius is allowed to walk away. If it proceeds based on original terms, the stock should shoot up to ~$32-33. If Fresenius is able to walk away, the stock price will drop
All the drama has caused options IV% to sky rocket to over 200%. (Historical is less than 50%). I sold a $10/$5 put spread. The only outcome that would put my position in jeopardy is if the ruling is totally in Fresenius favor and they are able to walk away. I think that is the least likely outcome, but still a possibility. That is the reason for utilizing a spread versus naked put.