SEC Is Investigating The Unusual Options Trades Ahead Of HP-3COM

On November 11th, options trading for 3Com (COMS) increased tenfold as inside information got out that telecom manufacturer would be acquired by HP (HPQ) for $2.7 billion. A week later and the SEC is now looking into the matter:

Bloomberg: 3Com call trading jumped to a 26-month high on Nov. 11, when Hewlett’s $2.7 billion takeover was disclosed after exchanges closed for the day. The Securities and Exchange Commission is examining whether someone used advance knowledge of Hewlett’s offer to illegally profit from the surge in 3Com’s stock when the deal was announced, according to the person, who declined to be identified because the inquiry isn’t public.

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