Unusual options activity is ignored by many investors, but for some, it plays a key role in their trading strategies and approach.
When big institutions make their move in the options market, they can’t hide the trade once the volume shows up and the open interest is logged. Thankfully, there’s a leaderboard of options activity for both calls and puts, helping us keep track of it all when we see outsized volume.
After Tesla delivered a mixed earnings report earlier this week, some unusual options flow started to show up, so let’s start with that name first.
One Tesla (US:TSLA) trade that really stood out to me was the February 2023 calls, which was sold-to-open all throughout Thursday Oct. 20th, the first trading session after Tesla reported on Wednesday evening.
The first trade occurred shortly after noon ET when the trader sold $1.1 million worth of the calls. Then less than two hours later, the trader popped off two more sales in the same calls, selling $1.025 million and $902,000 in premium. Finally, with five minutes left in the session, the trader sold $637,000 worth of premium.
Out-the-money call sales are generally bearish and that’s what these appeared to be as well, unless it is accompanied by a lower-strike call purchase (making it a bull-call spread). However, I have not seen any significant lower-strike purchases to make it such a spread, although they could be “hidden” in a different expiration date.
On the put side, millions of dollars in bearish premium has been opened with 0 to 8 days until expiration.
However, the one trade that stood out to me was the $1.386 million in bullish premium one trader sold for the February 2023 $200 puts. These are slightly out-the-money puts, but close to at-the-money. Meaning this trader is looking for a bottom in Tesla stock, at least for the next few months.
Someone is expecting a huge move higher in Intel (US:INTC) — and they expect it soon.
These traders scooped up tens of millions of dollars in the $23.50 calls expiring next week on Oct. 28th. All of these trades occurred around the same time, but included $8.6 million, $9.4 million and $1.02 million in premium, along with plenty of others that were in the six-figure range.
Just like last week, Twitter (US:TWTR) again makes the list. That’s as investors keep speculating on the Elon Musk buyout for Twitter.
The trade that stands out was in the $38 calls expiring in two weeks on Nov. 14th, as one trader paid roughly $9 million in premium for the position.
That’s a big price for what is essentially a binary event, especially an in-the-money position that expires in just two weeks. Remember, these are about $12 in the money already.
Barrick Gold (GOLD)
Gold is a favorite talking point for many investors and Barrick Gold (US:GOLD) gets a fair amount of discussion as a top miner in the space.
Someone is putting their money where their mouth is with this long-term bet. This trader paid $2.9 million in premium for the $17 strikes expiring in January 2024, or in more than 450 days.
Lockheed Martin (LMT)
Last but not least, we have Lockheed Martin (US:LMT). This stock is not known for big options trades, but one jumped out after a trader dropped $2.2 million in premium for the March 2023 $465 calls.
These calls were about $25 out-the-money at the time of the trade, but are now just $10 out-the-money. The trader has plenty of time on their side if this trade cooperates and LMT pushes higher.
This article originally appeared on Fintel
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