Wednesday, June 1, 2022

How the Elites Get Flagged By the SEC

Even the wealthiest investors make mistakes that get them in big trouble

How the Elites Get Flagged By the SEC


Back in 2013, Warren Buffett teamed up with a Brazilian company called "3G" to buy HJ Heinz, the ketchup company.

The purchase price was 19% higher than what the stock was trading at the close.

The day before the announcement, someone purchased a block of over 2,500 out of the money (OTM) calls for a capital outlay of about $90k.

The next day, those same calls were worth over $1.8 million.

Not bad for a trade, but this is the stupidest way to play it.

Trading options the day before a buyout will throw up a million red flags for the SEC…

Which is what happened.

In February 2013, the SEC started hunting down those trades. 

Turns out they found some shady stuff going on…


 


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To Your Trading Success,

Steven Place
Market Analyst

 



Market Traders Daily
 

Disclaimer: Futures, forex, stock, and options trading are not appropriate for all traders. There is a substantial risk of loss associated with trading these markets. Losses can and will occur. No system or methodology has ever been developed that can ensure returns or against losses. No representation or implication is being made that using any of these methodologies or systems will generate returns or ensure against losses.
 

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