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David Pinsen
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I founded Launching Innovation, LLC, to bring together developers, designers, and academic finance experts to create easy-to-use tools to solve complex problems for investors.
My company:
Portfolio Armor
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Steam Catapult
  • Last Trade Of The Year: Betting Against AIB (again) 0 comments
    Dec 31, 2010 4:23 PM | about stocks: AIBYY, NBG
    Short Screen members may recall I bought puts on AIB at the end of July, 2010, and sold them in October ( http://shortscreen.com... ). As I noted back in July when I bought those puts,

    Among the European banks that passed the stress test, AIB had one of the weakest sets of results. And bear in mind that these stress tests didn't test for the effects of a sovereign default (http://www.bloomberg.c... )

    AIB's situation has only gotten worse since, as Monday's Lex column on Ireland in the FT (Registration required, I think: http://www.ft.com/cms/... ). Excerpt:

    The end is approaching for non-government shareholders of Allied Irish Banks. The Irish government announced on December 23 that the National Pensions Reserve Fund Commission would inject €3.7bn into AIB, multiplying the state’s share of the equity fivefold to 93 per cent.

    The price suggests the desperation of the situation.

    I picked up a few of the $1 strike, August 2011 puts on AIB today at $0.40.

    Incidentally, I am still holding puts on one other European bank, NBG ( http://shortscreen.com... ).
    Themes: Banks, Europe, Sovereign Debt Stocks: AIBYY, NBG
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