Suspicious trades were made before Goldman’s $2.2 billion acquisition of GreenSky, options experts say

Suspicious trades were made before Goldman’s $2.2 billion acquisition of GreenSky, options experts say

The day before announced its purchase of fintech lender , someone placed options trades that immediately soared in value, moves that market participants say indicates advance knowledge of the deal. On Sept. 14, the trader bought 8,000 options that would only pay off if the price of GreenSky rose above $10, according to the market participants. The options were out of the money — meaning that GreenSky was trading well below the strike price — and cost just a nickel per share. After news of the deal , the value of the contracts, each allowing for the purchase of 100 shares of GreenSky, skyrocketed. The trader made an astounding 3,900% gain in a single day, the market sources say. That means a $40,000 bet would have turned into about $1.6 million. Acquisitions are complicated transactions involving teams of bankers, lawyers and other specialists with access to market-moving information. With that many sets of eyes on a deal, information often leaks. As many as one-quarter of all public company deals result in some form of , often involving out-of-the-money calls in the options market, according to a by professors at the Stern School of Business at New York University and McGill