I bought 4 Oct. $32.50 Call options for AT&T on the morning of 10-13 in anticipation of AT&T's proposed buy out of Bellsouth. Once this deal gets approved both stocks will posts gains. The Federal Communications Commission was to vote on approval on that Friday afternoon. Well the meeting took place and the FCC stated they would delay the decision till Nov. 1st. This decision did not make the share holders all warm and fuzzy, so the stock took a small dive. My call options went from $1.20 (where I got in) to .25 cents. So I bought 4 more options at .25 cents, this brought my cost basis down to .72 cents. Now I hold 8 call options at .72 cents. This week AT&T stock made a come back on a few huge contracts that they won. My options went from .25 cents to $1.40. On Thursday 10-19 I sold 4 calls at $1.40 making a 94 % gain. So today on 10-20 (options expiration date) I sold the remaing 4 calls at $1.60 making a 120% gain.
This was a good trade, taking a losing trade and turning it into a big gain.
ps.. I am think about getting back in on the Nov. call cause the FCC will meet again on the 1st. AT&T also reports quarterly earnings on Monday the 23rd.
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