After the government announced that they were going to take control of investment bank giant, Goldman Sachs, the company share prices went on a decline. I bought GS 100 put @ 6.00. The put contracts went up to as high as 7.57 today but I did not sell it. GS was trading weakly for most of the day. At the end of the day, there was a sharp increase in price with huge volume behind it. Later, I came to know, Mr Buffet is planning to pour some $5 billion in Goldman Sachs. I can see my puts become worthless by tomorrow morning.
GS opened today at 118.89, and fell to as low as 113.01 and ended up closing at 125.05. After the market closed, the share prices jumped to 134.75. Should I follow Mr. Buffet footsteps?
Berkshire buying $5 billion stake in Goldman Sachs