Large Stock/Option Volume Alerts in Seabridge Gold

Seabridge Gold, Inc. (NYSE: SA) is a company small enough and obscure enough that we would rarely cover it.  So what happens when investors are starting to pile back into major gold stocks? The second tier companies get interest too.  The difference is that this appears to some sort of chatter here driving the price and volume in Seabridge Gold.  What that is we do not know and would say that the trading volume speaks for itself.

Here is the huge option spike.  The January 2013 $15 Call Options last traded ad $1.85 per contract, but the volume is 17,401 contracts.  The prior open interest is a mere 338 contracts.  Keep in mind that this translates to a speculative bet on 1.74 million shares on a fully leveraged basis if you count one contract as being the equivalent to 100 shares.

As far as the volume spike in the shares, we have seen over 730,000 shares traded as of 11:07 AM EST and the gain is 8.4% to $13.43.  The stock hit a low of $12.25 today and the prior 52-week range is $12.20 to $31.34.  An average day’s volume in Seabridge is only 322,000 shares.

The Yahoo! Finance description of the company is that Seabridge is a development stage company which engages in the acquisition, exploration, and development of mineral properties, primarily gold properties located in North America.

Seabridge is based in Toronto, Canada and here is its own description: “Seabridge Gold’s resource base of gold, copper and silver is one of the world’s largest. Our principal projects are located in Canada. Our objective is to grow resource and reserve ownership per share. Our risk-reducing strategy: acquire North American deposits; expand them through exploration; move them to reserves through engineering; and sell or joint venture them to established producers for mine construction and operation.”

JON C. OGG