[yellowstuff]

I strongly suspect these trades are not legit. That said, the trader didn't necessarily KNOW that the deal would be announced today. Trading is a game of probabilities. It's possible that the trader used public information to figure out that Splunk could be acquired soon and there was a small but non-zero chance it would be announced today. In that case taking a $22k flyer on cheap options is a good risk-adjusted bet for a well-capitalized investor. (Although they'd have to factor in that this WILL result in a visit from the SEC, which is probably not fun even if you've done nothing wrong.)

[mattnewton]

Yeah, I don’t know, an investor sophisticated enough to predict that without insider information, I would have to hope that they would also be sophisticated enough to make the trade less blatantly obvious as a big bundle on 1 day expiration otm call options.