2 Points - SEC & Deep In the Money Calls
Anybody with any experience in this area knows that if you bought stock or options immediately before a takeover that you will receive a visit from SEC investigators.
These guys are very thorough; they check your trading patterns, relationships with anybody in either company or anybody esle that traded the stock or options. They are very good and very thorough.
As to a scan to find potential takeovers, a scan of deep in the money calls can be more revealing than a scan of stock volume alone.
Deep in the money calls carry very little time premium and are seldom traded in volume. Volume in deep in the money calls is often a sign of sophisticated accumulation.
Discoveing a potential takeover via the technical analysis of volume is not illegal and if the scan is sophisticated enough can offer considerable completely legal opportunity.
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