Monday, May 20, 2024
Tesla (TSLA) traded nearly 3.5 million options contracts the day after earnings last week. However, one unusual block trade really stood out on that day. A strategist placed a roughly one-week put butterfly trade, which has maximized gains if TSLA drops 20% in about a week. The trade starts making money if TSLA drops about […]
With the bond market in focus this year, there’s been plenty of options action in iShares 20+ Year Treasury Bond ETF (TLT). The long-term bond fund is the most active of the treasury bond ETFs, trading around 180,000 options per day on average. A large trader or fund placed a very interesting spread trade last […]
A big deal in the grocery store space was announced last week with the potential acquisition of Albertsons (ACI) by Kroger (KR). The merger would create a grocery chain with roughly 12% control of the US market. It’s difficult to say if the deal will make it through antitrust scrutiny. Interestingly, short-term block options trades […]
One way to trade a potential market rebound without the risk of buying stocks outright is by using covered calls. A covered call will cap the upside of a stock or index, but provides cash flow and a bit of downside cushion. Recently, a trader placed a 20,000-lot covered call trade using iShares Russell 2000 […]
With energy markets being highly volatile this year, it’s not a surprise to see large block trades occur in big energy companies. Oil and gas giant, Exxon Mobil (XOM), tends to have plenty of options volume on a regular basis. However, on a busy day last week, it traded nearly twice the amount of average […]
A very unusual options block trade hit the tape last week in Lithia Motors (LAD). The automobile dealership company typically trades about 200 options a day on average. However, a trader recently executed a 9,500-lot trade of November covered calls in LAD options. The trade could suggest there is both a floor and a ceiling […]
It’s been a high volatility year in the financial markets. The VIX (Cboe S&P Implied Volatility Index) has been historically high for most of 2022. A large put sale in Proshares Ultra VIX Short Term Futures ETF (UVXY) suggests that volatility could remain at least moderately elevated into 2023. UVXY is a popular short-term volatility […]
Stocks finally halted their selloff at the midpoint of last week, with the major indices all up at least 2% on the day. On that day, the iShares Russell 2000 ETF (IWM) was up over 3%, marking an outperformance from small cap stocks. A trader appears to have used the opportunity to place a 10,000-lot […]
Volatility is back to high levels after the Fed sounded increasingly hawkish after last week’s FOMC meeting. At least one volatility ETF, the ProShares VIX Short-Term Futures ETF (VIXY), saw an unusual increase in options volume during the period. However, it seems there was a fair amount of put buying, suggesting traders believe volatility may […]
Even with rates going higher, fixed income ETFs don’t tend to move all that much. One way to amplify your cash flow from a fixed income product is by using options. Last week, some appeared to have sold 25,000 put spreads in the Invesco Senior Loan ETF (BKLN). BKLN has only moved in a $2 […]
