Delta bankruptcy claim stock

[Benjamin Dover]

I heard around 10% of Delta pilots took the stock rather than pre-selling their shares of the "new" Delta post bk stock back then. Anyone know how they are doing now at today's share price vs. those that sold at a discounted rate back then?

 

[swaflyguy]

I bought 5k shares after bankruptcy at 7.83. Still have it. Should continue a run up through January then I'll re evaluate. Thanks Delta.

 

[jonjuan]

I bought 5k shares after bankruptcy at 7.83. Still have it. Should continue a run up through January then I'll re evaluate. Thanks Delta.

Sure ya did.

 

[swaflyguy]

Your right,I was mistaken.. Actually 7.86 on 7/26/11 at 09:57:37. I do a lot of trading. Just for good measure also bought 2k 1.60 Jan 14 25$ calls the day before earnings a couple of weeks ago. 3.42 at close today.. Made 7 trades today. It's not that hard.

 

[SIG600]

Congrats, you can buy a new Audi. Enjoy retirement.

 

[Andy]

Your right,I was mistaken.. Actually 7.86 on 7/26/11 at 09:57:37. I do a lot of trading. Just for good measure also bought 2k 1.60 Jan 14 25$ calls the day before earnings a couple of weeks ago. 3.42 at close today.. Made 7 trades today. It's not that hard.

You bought 2K calls @ 1.60? That's $320K plus commissions. Gutsy.
I show $3.50Bid, $3.60Ask on them. At $3.50, that'd be $700K minus commissions. After taxes, that'd be enough to buy 2 new Audis - if they're an R8 and an A8 L W12.

 

[Benjamin Dover]

deleted

 

[jonjuan]

You bought 2K calls @ 1.60? That's $320K plus commissions. Gutsy.
I show $3.50Bid, $3.60Ask on them. At $3.50, that'd be $700K minus commissions. After taxes, that'd be enough to buy 2 new Audis - if they're an R8 and an A8 L W12.

Like I previously said, sure he did. :laugh:

 

[SWA Bubba]

You bought 2K calls @ 1.60? That's $320K plus commissions. Gutsy.
I show $3.50Bid, $3.60Ask on them. At $3.50, that'd be $700K minus commissions. After taxes, that'd be enough to buy 2 new Audis - if they're an R8 and an A8 L W12.

Like I previously said, sure he did. :laugh:

You're assuming he bought 2 thousand contracts (100 calls each), which would total $320,000 plus commission. I don't think that's what he meant. I read his statement as 2 thousand actual call options (20 contracts of 100 each), which, at $1.60 each, would total $3,200 plus commission. That's the normal terminology anyway: some amount of "calls or puts" (actual number of options), vs. some amount of "contracts" (groups of hundreds of options).

That seems a more likely (and believable) trade amount for non-institutional trader. I trade in like amounts, which still gives you a pretty good quick return, if they're really $1.90 in the money. That's the beauty of options: you can control a lot of stock for not a lot of money. However, I'm personally too chickensh!t to trade options on airline stocks--they're too volatile.

Bubba

 

[Andy]

You're assuming he bought 2 thousand contracts (100 calls each), which would total $320,000 plus commission. I don't think that's what he meant. I read his statement as 2 thousand actual call options (20 contracts of 100 each), which, at $1.60 each, would total $3,200 plus commission. That's the normal terminology anyway: some amount of "calls or puts" (actual number of options), vs. some amount of "contracts" (groups of hundreds of options).

That seems a more likely (and believable) trade amount for non-institutional trader. I trade in like amounts, which still gives you a pretty good quick return, if they're really $1.90 in the money. That's the beauty of options: you can control a lot of stock for not a lot of money. However, I'm personally too chickensh!t to trade options on airline stocks--they're too volatile.

Bubba

Bubba, I've been around trading for a long time; I've never heard anyone call a stock options contract (which is based on 100 shares of stock) as 100. It's understood that one contract controls 100 shares of stock. That would be like calling a single CL contract (oil futures contract) as 1,000 since one CL contract controls 1,000 barrels of oil.

The standard terminology when you talk about buying or selling contracts is using the actual number of contracts that you're trading. Perhaps he dumbed down his statement for the audience, but anyone who trades as frequently as he stated would be expected to use standard terminology.

 

[ACL65PILOT]

The stock that the pilots were granted in their 401K's was from the merger. Ballpark estimate from when the stock actually entered each pilots' 401k to today is about a 559% increase.

If a pilot kept that stock, its valuation is 90-100K depending on their seniority at the time of the merger.

 

[swaflyguy]

I worded it that way intentionally.. 20 contracts is 2000 options. Hence options as opposed to contracts. You are correct. But I am surprised that many people don't know that so I made it simple. If it makes you feel better I got my ass kicked today on a CMG vertical bull put.

 

[Andy]

I worded it that way intentionally.. 20 contracts is 2000 options. Hence options as opposed to contracts. You are correct. But I am surprised that many people don't know that so I made it simple.

OK, that's still not correct. You can't separate 'option' from 'contract' like that; 'option' is not the same as 1 share of stock.

In this link: http://www.learn-stock-options-trading.com/what-are-stock-options.html they define stock option contract,
"A stock option contract grants you the right to buy or sell a specific stock.
1 stock option contract = 100 shares of a company's stock. So when you buy 1 contract you are buying the right to buy or sell 100 shares of that stock."

And here's investopedia: http://www.investopedia.com/terms/o/optionscontract.asp
"Definition of 'Options Contract'
A contract that allows the holder to buy or sell an underlying security at a given price, known as the strike price. The two most common types of options contracts are put and call options, which give the holder-buyer the right to sell or buy respectively, the underlying at the strike if the price of the underlying crosses the strike. Typically each options contract is written on 100 shares of the underlying."

I understand dumbing down your trade for public consumption here, but you used standard terminology for trading 2,000 options contracts. I even looked up that strike to see the OI (open interest), which was in excess 27,000 options contracts.

It's not a big deal and I realize I'm getting into the weeds over this, but I'd recommend writing something like, 'I bought call options on 2000 shares of DAL @ 1.60 for the Jan 14 $25 strike'. Of course hindsight's 20/10.

Sorry to hear about your loss on your options spread. I don't play with options very often; mostly just to write covered calls. Unfortunately, just about every covered call I've written this year has cost me gains (it's been a nonstop bull market) so it's simply reinforced my disdain of options.

 

[DTW320]

Merger stock was granted to pilots on 3/6/2009 at $4.26/share.

Approx $28.50 right now plus a 6 cent/share dividend paid in September.

As of today, ACL65's approx valuations for those who have held onto it seem a bit low. Mine's worth north of 100K and there are lots of folks that got a good bit more shares than me.

 

[Benjamin Dover]

I forgot about the merger stock, but wasn't there stock granted to Delta pilots pre-merger in exchange for terminating the pension plan?