reply to post by CameronFox
Interesting point but in looking at the Airlines which are commonly traded as a sector
if investors believe the airline industry is due to drop, they will short all three major carriers. This was not the case here because Delta did not
see spikes similar to UAL and AMR.
The high number of put options didn't necessarily ONLY apply to the two airlines involved but traversed several business sectors that might have been
effected such as:
Insurance:
Munich RE - The largest reinsurer in Germany
Swiss RE - The largest reinsurer in Switzerland
AXA Group of France -
Trading in shares of Munich Re was almost double its normal level on September 6, and 7, and trading in shares of Swiss Re was more than double its
normal level on September 7.
Financial Services Companies:
Merrill Lynch and Morgan Stanley Morgan Stanley Dean Witter & Co. and Merrill Lynch & Co. were both headquartered in lower Manhattan at the time of
the attack.
Morgan Stanley occupied 22 floors of the North Tower and Merrill Lynch had headquarters near the Twin Towers. Morgan Stanley, which saw an average of
27 put options on its stock bought per day before September 6, saw 2,157 put options bought in the three trading days before the attack. Merrill
Lynch, which saw an average of 252 put options on its stock bought per day before September 5, saw 12,215 put options bought in the four trading days
before the attack. Morgan Stanley's stock dropped 13% and Merrill Lynch's stock dropped 11.5% when the market reopened.
Bank of America showed a fivefold increase in put option trading on the Thursday and Friday before the attack.
A Bank of America option that would profit if the No. 3 U.S. bank's stock fell below $60 a share had more than 5,900 contracts traded on the Thursday
and Friday before the Sept. 11 assaults, almost five times the previous average trading, according to Bloomberg data. The bank's shares fell 11.5
percent to $51 in the first week after trading resumed on Sept. 17.
Coincidentally though, while most companies would see their stock valuations decline as a result of the attack. Those in the business of supplying the
military would see their stocks soar.
Raytheon, maker of Patriot and Tomahawk missiles, saw its stock soar immediately after the attack. Purchases of call options on Raytheon stock
increased sixfold on the day before the attack.
US Treasury Notes:
US Treasury Notes are the safe harbor investment especially in the event of a worldwide crisis. Five-year US Treasury notes were purchased in
abnormally high volumes before the attack, and their buyers were rewarded with sharp increases in their value following the attack.The SEC began
investigating and the Secret Service even began a probe investigating a single $5 Billion trade.
In summary:
Looking at the inordinately high amount of trade volume immediately prior to 9/11, it's beyond coincidence that the PTB knew what was going to
transpire and capitalized immensely on this event.
There were also almost $2.5million in unclaimed options left on the table once the news of 9/11 insider trading had reached the MSM which indicates
that someone did not want their identity revealed.