Subject: RE: Hedged MRK [C] From: Stewart Oldfield ‹ > Date: Thu, 03 Sep 2015 13:27:53 -0400 To: Daniel Sabba ‹ > Classification: Confidential Is it more efficient to just buy calls? From: Daniel Sabba Sent: Thursday, September 03, 2015 12:50 PM To: 'jeffrey E.' Cc: Paul Morris; Todd Stevens; Stewart Oldfield; Vahe Stepanian; Ariane Dwyer; 'Richard Kahn' Subject: Hedged MRK [C] Classification: Confidential Jeffrey- please see below as a follow up to yesterday's chat on MRK. Note that MRK reached its 52wk low of $51.17/sh. last Tuesday (8/25), and its currently not too far off of the lows @ $53.44/share. Please let us know the number of shares you wish to purchase outright, as well as the tenor and strikes of the puts. Below, we've included levels for —10% OTM listed puts, both 3m and 6m tenors. MRK Puts MRK Ref = $53.44 Expiry: November 2015 EFTA01417326 Strike Bid Ask 47.50 0.83 0.85 50.00 1.31 1.37 Expiry: April 2016 Strike Bid Ask 47.50 2.06 2.18 50.00 EFTA01417327 2.85 2.96 MRK Nov 47.50 put: implied volatility v. price (per contract) fcid:image007.jpg@OlDOE63E.6FD27A101 MRK Nov 50 put: implied volatility v. price (per contract) fcid:image009.jpg@OlDOE63E.6FD27A101 MRK Apr16 47.50 put: implied volatility v. price (per contract) fcid:image011.jpg@OlDOE63E.6FD27A101 MRK Apr16 50 put: implied volatility v. price (per contract) fcid:image016.jpg@OlDOE63E.6FD27A101 MRK Stock Price (September 2014-September 2015) {cid:image002.jpg@OlDOE63E.6FD27A10} Source: Bloomberg Finance L.P. Daniel Sabba Key Client Partners Deutsche Bank Securities Inc. Tel. EFTA01417328 Mobile Email All trade execution information contained herein is being provided as an accommodation at your request in advance of your receipt of the official trade confirmation(s). Additional trade detail information available upon request. The terms of the trade(s) may be subject to change prior to settlement, and therefore the official trade confirmation(s) and account statements issued by Deutsche Bank shall govern. Deutsche Bank is not responsible for any discrepancy between the informal execution report and the official trade confirmation(s) or account statements. EFTA01417329