Latest news with #options
Yahoo
6 hours ago
- Business
- Yahoo
This Week's Market Momentum: 3 Exceptionally Active Options
Returning from the Juneteenth holiday respite, the markets are expected to head lower on Friday due to global geopolitical uncertainty stemming from the Israel-Iran conflict. Typically, on Fridays, I'll discuss the unusual options activity from the previous day's trading. I can't do that in light of the holiday and the markets being closed. This Options Tool Can Show You How to Trade Tesla Stock Ahead of Robotaxi Day Amazon Ratio Spread Targets A Profit Zone Between 190 and 200 How to Make a 2.0% Yield with UBER Over the Next Month Tired of missing midday reversals? The FREE Barchart Brief newsletter keeps you in the know. Sign up now! However, there were plenty of options action in the first three days of the week, so I've scoured the unusual options activity from Monday, Tuesday, and Wednesday, to find three stocks or ETFs that jump out for one reason or another. Monday led off the week with 945 unusually active options--defined as those with Vol/OI ratios of 1.24 or higher and expiring in seven days or longer--with the calls getting 61% of the action compared to 39% for the puts. Tuesday's put/call ratio was 41%/59%, another bullish day. On Wednesday, we saw more of the same, with calls accounting for 61% of the 1,065 unusually active options on the day, indicating that investors have yet to become concerned about the problems in the Middle East. That could change shortly. Let's get to the three that have captured my attention. Have an excellent weekend. Morgan Stanley's (MS) Dec. 17/2027 $80 put had the highest Vol (volume)/OI (open interest) ratio on Monday at 80.04. The volume of 8,004 was approximately half of the investment bank's 30-day average, making it a significant amount. Even more compelling because it was a single trade for 8,000 of the put contracts at 12:12 p.m. on Monday. Admittedly, when I first examined the top 100, I had a hard time understanding why someone would buy or sell this particular put, given that it is 39% out of the money (OTM). If you're bullish about Morgan Stanley's future, you likely wouldn't be buying the 8,000 put contracts to go long for downside protection. With a DTE (days to expiration) of 915, you probably wouldn't be selling them short, either, given the annualized return on the premium is just 2.6% [$5.10 bid price / $80 strike price*365 / 915]. However, when you think about it, the S&P 500 average dividend yield is currently 1.27%, so you're getting double that, without a near-term capital outlay, although you will need the cash on hand or margin equivalent should you have to buy the 800,000 shares of Morgan Stanley in December 2027. Morgan Stanley's current dividend yield is 2.79%, so you're effectively getting the same income, without spending $104.7 million [8,000 put contracts * 100 shares * $130.90 share price]. Nice. Exxon Mobil (XOM) had three unusually active options on Tuesday in double digits, including the Oct. 17 $150 call with the second-highest Vol/OI ratio at 48.72. The second and third call options from above are bets that the short-term price of oil will increase due to the ongoing conflict in the Middle East. In Nova Scotia, where I live, gas prices are regulated, with changes happening weekly or bi-weekly. The price increased by nearly five cents per liter today. With 10 days to expiration, the profit probability of both is low. You can sell before they expire to recoup some of the premium you paid. However, it is the $150 call on Oct. 17 that makes the most sense. With 122 days to expiration, oil prices could surge if the U.S. is dragged into the conflict. While Exxon Mobil can't run a business based on near-term oil prices, speculative investors would still pile in. The $0.10 ask price is just 0.20% of the $150 strike price and 0.26% of the $114 share price. That's peanuts for the big money out there. I like this Hail Mary bet. Planet Fitness (PLNT) had two unusually active options on Wednesday, with the July 18 $120 call in the top 100, with a Vol/OI ratio of 23.70%. Both OTM with 30 days to expiration, the Barchart Technical Opinion is a Strong Buy with the likelihood of its near-term trend continuing at 88%--the fitness chain's stock is up over 5% in the past five trading days--suggesting that a 30-day bet on its stock isn't the worst idea in the world. On June 16, TD Cowan analysts reiterated their Buy rating and a $125 target price, which is higher than both of the strike prices mentioned above. The broker has Planet Fitness as its top small and mid-cap investment idea. Of the 17 analysts covering PLNT stock, 15 rate it a Buy (4.65 out of 5). It currently trades at 37 times Wall Street's 2025 EPS estimate of $2.91 and 31 times the 2026 EPS estimate of $3.44. While that's high, its momentum makes it attractive to many investors. Of the two, I especially like the $120 strike because of its low outlay, which is just 0.54% of the strike price. Is there another 5% increase in the cards? There very well could be. On the date of publication, Will Ashworth did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Sign in to access your portfolio
Yahoo
2 days ago
- Business
- Yahoo
A $6.5 Trillion ‘Triple Witching' Heralds Return to Volatility
(Bloomberg) -- Investors are bracing for $6.5 trillion of notional US options expiring on Friday, in a move that could free stocks to swing more wildly than the subdued changes seen in recent weeks. Security Concerns Hit Some of the World's 'Most Livable Cities' JFK AirTrain Cuts Fares 50% This Summer to Lure Riders Off Roads Taser-Maker Axon Triggers a NIMBY Backlash in its Hometown How E-Scooters Conquered (Most of) Europe One Architect's Quest to Save Mumbai's Heritage From Disappearing Every quarter, a cluster of different exchange-traded derivatives contracts all terminate on the same day, leading to what is sometimes dubbed a 'triple witching' event by market watchers. The event isn't expected to add additional volatility on Friday itself, but could open a path to more sudden stock market moves next week. Daily gyrations in US stocks have been relatively restrained since early May, a situation helped by the pinning effect of a swath of bearish options trades placed earlier in the year — when the chances of the S&P 500 making a recovery to near-record highs seemed remote, according to Rocky Fishman, the founder of research firm Asym 500 LLC. 'Pinning' refers to the tendency of a stock price to close near the strike of heavily-traded options as the expiration date nears. During the height of tariff-driven volatility in early April, many pessimistic investors bought insurance against a further drop in stocks, funding those positions by capping upside a little beyond the S&P 500's current level of 5,981. 'People might have seen a 6,000 level as something that's really hard to get to as we were dealing with a lot of the tariff drama over the last few months, and therefore sold calls in the 6,000 range as a way of funding protection at various points,' said Fishman, who called Friday's expiry 'one of the largest ever' in a recent note. The way market makers and broker-dealers have to hedge their own books can have major implications and echo back into equity markets. Fishman says dealer hedging could be a contributing factor to the fairly placid state of equity markets since early May, despite turmoil in the Middle East and continued tariff talks. To Fishman, the market is in a state known as positive gamma, which means players can be incentivized to sell into rallies and buy dips. It was different during early April's tariff turmoil, when many intermediaries found themselves having to dump stock into falling markets, and then buy it back as markets rose, exacerbating swings, according to Matthew Thompson, co-portfolio manager at Little Harbor Advisors. Thompson pays attention to expiry events like the triple-witching because it can help the equity ETFs he manages alongside his brother Michael take tactical positions in volatility markets. 'We're mostly interested in the dealers and how they have to hedge all of that exposure,' Thompson said in an interview on Wednesday. The quarterly triple-witching days are not usually much more volatile than monthly options expiry events, according to a study by Vishal Vivek and Stuart Kaiser, strategists at Citigroup Inc. Still, Friday's event is 'notable,' the pair wrote recently to clients. There is no standard way to calculate the amount of listed-derivatives due to expire on any one day - it depends which type of asset class and contract one includes in the figure. Citi estimates that Friday will see $5.8 trillion of notional open interest across equities expire, including $4.2 trillion of index options, $708 billion of bets on US ETFs and $819 billion of single stock options. Fishman's larger figure of roughly $6.5 trillion also includes the notional value of options on equity index futures expiring on Friday. Ken Griffin on Trump, Harvard and Why Novice Investors Won't Beat the Pros Is Mark Cuban the Loudmouth Billionaire that Democrats Need for 2028? The US Has More Copper Than China But No Way to Refine All of It How a Tiny Middleman Could Access Two-Factor Login Codes From Tech Giants Can 'MAMUWT' Be to Musk What 'TACO' Is to Trump? ©2025 Bloomberg L.P.
Yahoo
2 days ago
- Business
- Yahoo
Mixed options sentiment in Webull Corp with shares down 0.77%
Mixed options sentiment in Webull Corp (BULL), with shares down 8c near $10.30. Options volume relatively light with 4729 contracts traded and calls leading puts for a put/call ratio of 0.22, compared to a typical level near 0.33. Implied volatility (IV30) dropped 1.15 near 74.62,in the lowest 10% of observations over the past year, suggesting an expected daily move of $0.48. Put-call skew flattened, suggesting a modestly bullish tone. Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Published first on TheFly – the ultimate source for real-time, market-moving breaking financial news. Try Now>> See the top stocks recommended by analysts >> Read More on BULL: Disclaimer & DisclosureReport an Issue Mixed options sentiment in Webull Corp with shares down 3.73% U.S.-China talks continue, IBM making large-scale quantum computer: Morning Buzz Webull Corp call volume above normal and directionally bullish Webull Corp launches Kalshi's hourly crypto markets on investing platform Largest borrow rate increases among liquid names Errore nel recupero dei dati Effettua l'accesso per consultare il tuo portafoglio Errore nel recupero dei dati Errore nel recupero dei dati Errore nel recupero dei dati Errore nel recupero dei dati
Bloomberg
3 days ago
- Business
- Bloomberg
Bitcoin Options Show Traders Hedging Against a Dip to $100,000
Bitcoin options show traders are hedging against a price pullback to the $100,000 price level with geopolitical and economic uncertainty rising across global financial markets. The put-to-call volume ratio on the crypto derivatives exchange Deribit surged to 2.17 over the past 24 hours, reflecting a strong tilt toward protective bets. Put options, which offer downside insurance by giving the holder of the contract the right to sell at a certain price, saw outsized demand, particularly in short-dated contracts. For options expiring June 20, open interest in puts struck at $100,000 now tops the board, with a put-to-call ratio of 1.16, underscoring concern about a near-term price fall.
Wall Street Journal
4 days ago
- Business
- Wall Street Journal
Robinhood Launches New Tools to Woo Traders
Robinhood Markets HOOD -1.91%decrease; red down pointing triangle ushered millions of traders into the world of investing. Half a decade later, the brokerage is rolling out new features to maintain their loyalty. The financial services company with meme-stock origins is introducing two new features that will bring more sophisticated trading capabilities to its mobile app, including a tool that lets users preview simulated returns before they place an options trade.
