Fortress Investment Group And Why Option Alerts Are So Important

Fortress Investment Group LLC FIG shares are up 28.5 percent after SoftBank agreed to buy the company for $8.08/share. The news came just hours after Benzinga alerted its pro subscribers to two unusually large Fortress call purchases on the options market.

At 1:14 p.m. ET on Tuesday, Benzinga Pro sent out the following options alert on:

Fortress Investment Group Mar 6.0 Calls Sweep: 623 @ ASK $0.30: 958 traded vs 2334 OI: Earnings 2/23 Before Open (est) $6.10 Ref

Roughly an hour later at 2:25 p.m., Benzinga Pro alerted users to another unusual Fortress options trade:

Option Alert: Fortress Inv Group Mar 6.0 Calls Sweep: 577 @ ASK $0.447: 5249 traded vs 2334 OI: Earnings 2/23 Before Open (est) $6.30 Ref

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News of the buyout broke at around 6:15 p.m., sending shares of Fortress soaring.

Related Link: How To Read And Trade An Options Alert

Stock traders often watch the options market for any unusual activity, such as the two big trades in Fortress ahead of the news.

Options traders are typically seen as more sophisticated and advanced than the average stock trader. That generalization is particularly considered to be true when it comes to options traders who place extremely large orders. In other words, when somebody makes a huge bet in the options market that a stock is going to go up or down, stock traders take it seriously.

The Benzinga team is constantly scouring the options market looking for trades that could indicate big stock market moves ahead. Fortress Investment traders that used Tuesday’s option trades as a buying opportunity certainly didn’t have to wait long for a big payoff.