Wednesday, January 22, 2025
Snap (SNAP) is a popular social media company that has struggled in recent months. The company recently announced it would be cutting 20% of its workforce, which sent the share price up about 9% at the time. A strategist used the opportunity to place what looks like a long-term covered call. It was a 5,000-lot […]
The share price of Peloton (PTON) has taken a massive beating after being a darling of the Covid era. The exercise bike maker has struggled to appease investors as sales growth has slowed. However, investors liked a new deal between PTON and Amazon (AMZN) last week, which sent the shares up 20%. A bullish block […]
The most popular way for investors to trade small caps is through the iShares Russell 2000 ETF (IWM). IWM averages nearly 30 million shares traded per day, and over 750,000 options. Last week, a large fund or trader placed a block of nearly 50,000 puts in IWM that expire in October. These far-out-of-the-money puts could […]
The iShares JP Morgan USD Emerging Market Bond ETF (EMB) is an asset allocation fund for those wanting exposure to emerging market government bonds. The ETF pays a reasonable dividend but it doesn’t generally move all that much. A well-capitalized trader is likely trying to boost returns on the low-volatility product by utilizing a covered […]
Using covered calls on index ETFs is a popular way to produce additional cash flow from holding stocks. For instance, the SPDR S&P 500 ETF (SPY) is not only the most heavily traded ETF in the world, but it’s also commonly used for covered call trades. A large block of covered calls seemingly traded last […]
The iShares MSCI Emerging Markets ETF (EEM) is a very popular stock ETF which tracks companies in emerging market countries. The ETF is commonly used for asset allocation purposes in portfolios to gain exposure to the emerging markets asset class. Last week, a very large block trade occurred, which was likely a covered call trade. […]
Block trades can be useful in determining what smart money sentiment is on certain stocks. For example, a large put spread traded last week in Chewy (CHWY). The pet supplier site has seen its share price rebound off the lows in recent weeks. However, this recent put spread suggests there could be further downside ahead. […]
There was quite a bit of unusual options action in the Energy Select Sector SPDR ETF (XLE) last week. Energy has been in the spotlight with the price of crude oil plunging in recent days. However, a large ratio call spread in XLE suggests that energy stocks may have more room to rise this year. […]
A massive options trade occurred last week in iBoxx $ High Yield Corporate Bond ETF (HYG). HYG is a massively popular high yield bond fund that also has a very active options chain. A put spread was recently sold on HYG with over 150,000 contracts per leg. This trade is likely meant to boost “yield” […]
Once you are able to determine where unusual options activity is occurring, the next step is looking at the time and sales list. This is the granular trade information, where you can sort the list and look at what the biggest trades have been, and what caused the underlying instrument to show up on your […]
