Trader Turns $22,000 Into $10M In One Day: Insider Trading Or Genius In Cisco-Splunk Deal?

Cisco Systems Inc CSCO announced this morning that it will be acquiring Splunk Inc SPLK, a California software data company, for around $28 billion or $157 a share. Splunk’s stock traded over 20% higher on Thursday following the news of the acquisition.

One lucky trader bought $22,000 worth of out-of-the-money call options with a strike price of $127 on Splunk Wednesday that expire on Friday. At the time, the stock was trading around $120 a share. This means the trader was betting the stock would increase dramatically in a span of just a couple of days. 

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The call options were trading for just $.04 a piece on Wednesday. After Cisco announced the acquisition and Splunk shares shot higher, those contracts were worth more than $18.30. That makes the trader’s options worth more than $10 million, not bad on a $22,000 bet. 

Unusual Whales shared the trade on X.com, and the post has been viewed more than three million times.

Want to see a crazy trade?

Yesterday, someone OPENED $SPLK 127 calls, for $22,000, expiring tomorrow.

Then today Cisco Systems $CSCO announced acquiring Splunk for $28B, $SPLK up 20%.

The contracts were $0.04 yesterday, now $18.30.

They exited today for a 45,650% return... pic.twitter.com/uP6BnNzscp

— unusual_whales (@unusual_whales) September 21, 2023

Many users are speculating that there was something fishy going on, and that the trader had to have some sort of non-public material information on the acquisition.

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