SodaStream trader makes 3,000% profit in 2 hours

The longshot bet was made before news broke that the company may go private.

By MSN Money Partner Jul 25, 2014 12:06PM
SodaStream soda mixes (© Todd Oren/Getty Images for SodaStream)By Alex Rosenberg, CNBC

Was it skill, dumb luck -- or something more sinister? 


That's what traders are asking about a big, longshot bet on SodaStream (SODA) that returned some 3,000 percent in just two hours.


Two minutes before 10 a.m. ET on Thursday, one options trader bought 500 weekly 30-strike calls in SodaStream for 15 cents each (or $15 per contract, given that each contract controls 100 shares) that expire Friday. It was by far the biggest SodaStream trade of the day in terms of the number of contracts. 


The purchase gives the trader the right to buy SodaStream shares for $30 at the close of Friday trading. The reason those options were so inexpensive is that the stock was trading at about $29.50 at the time, meaning the chance of the stock closing Friday above $30 was considered to be especially low.


But then, shortly before noon, Bloomberg reported that the company is in talks with an investment firm about taking the company private. After a halt, the stock sailed as high as $36.


The news created an instant windfall for the trader, as these options, which were bought for $7,500, became worth as much as $250,000.


"Prior to the halt, calls had already traded more than two times their average daily volume," commented Dan Nathan of RiskReversal.com. "The fact that the most active option of the day was an out-of-the-money call that expired tomorrow suggests someone knew something, as there were no scheduled events."


The trade, which could end up drawing insider-trading-related scrutiny, joins other recent suspicious options trades, such as the "fishy" action in Puma Biotechnology (PBYI) ahead of that company's announcement of positive test results.


More from CNBC


Tags: SODA
10Comments
Jul 25, 2014 12:30PM
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This is nothing more than insider trading..period.  Plus Soda Stream is a fad product that gets bought as a gift primarily at Christmas when their "demonstrators" are in the retail stores giving away free samples etc.  Most machines are never used beyond the first time.  They are much to cumbersome, too much work to in essence get a product (flavored water) which you can buy for less money at the grocery store as a result there are very little residual sales for the CO2 cartridges and flavorings. 
Jul 25, 2014 1:17PM
Jul 25, 2014 12:15PM
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Obviously, he has been tagged with a GPS device and awaits a Federal investigation for insider manipulation, right? Right. 
Jul 25, 2014 12:18PM
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Like... honest people would say... hmmm, Sodastream looks like the kind of company that will go private. I will invest in it now. 
Jul 25, 2014 4:18PM
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See u monday Barry - I hope your life rafts don't sink and also I hope the toothless mountain banjo folk hear you clumping through the woods and manage to get away so they don't have to take you again .."against your will" .....  =)
Jul 25, 2014 4:12PM
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Oh and Barry has your "WW2" veteran Dad founght in any more wars a child soldier ....maybe it was the Irgyn or the Hagannah - or even  the LEHI perhaps ????
Jul 25, 2014 4:12PM
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Long lunch eh barry ?  I guess you had to pay by the inch for your pork injection .....I am guessing you favor the dark meat ...hence all the "N" bashing ....

Kayaking ....is that what they call it now ...don't get me wrong I have nothing against gays - each to his own I say - and the more single honeys for me ..... either way I do hope you are not taking a boy scout troop with you as I think we all know where that will end !! 

Don't forget not to come home too early - you don't want to find your old lady banging the local HS basketball team --- AGAIN !! 

You're too easy barry - btw how on earth do you fit 480lbs into a kayak -- or let me guess its actually two life rafts tied together  right !!! :)
Jul 25, 2014 1:29PM
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So barry what are you up to this weekend ...taking the kids up to Sodom and Gomorah again for a trip down memory lane ?

Taking the canoe back up to Deliverance River again and hoping you don't get "accidentally" ned beattiied again ....

Trolling for teenage runaway boys so you can bring them home and teach them "krav maga" 
Jul 25, 2014 1:27PM
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As for hating Jews - christians and muslims - here goes - I don't like zionists - islamists and those crazy bible thumping redneck christians - they are all cut from the same cloth.

I told you before my lovely little Tikkun GF - (who also is part of Jewish Voices for Peace)  told me you are the absolute mirror of all her fat pervy uncles in NY ...she also:mentioned most of them are hated by their own kids as well so I am guessing that fits you too !! ; )   Last real man - thats a joke .. the last real man is likely rolling off your old lady nright now !!  
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