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Tesla Attracts Investors With Hundreds of Millions of Dollars in Wagers
$Tesla (TSLA.US)$ 's 28% share slump this year is attracting investors with hundreds of millions of dollars, wagering they could benefit from more wild swings in prices.
Yesterday, up until the last two seconds of trading, whales were spending millions, placing their bets. The biggest block trade was for short put options where the seller stands to collect a premium of $101.5 million for writing options that give the holder the right to sell 2 million shares at $230 each by March 15.
Yesterday, up until the last two seconds of trading, whales were spending millions, placing their bets. The biggest block trade was for short put options where the seller stands to collect a premium of $101.5 million for writing options that give the holder the right to sell 2 million shares at $230 each by March 15.
The trade was posted at 3:43:31 p.m. New York time yesterday, the exact same time when five other huge transactions covering options of the same expiration date were recorded, signaling they could be all part of a strategy.
Another block trade was for short put options where the seller could collect a premium of $16.61 million for writing options that give the holder the right to sell 550,000 Tesla shares at $210 each also by the end of next week.
That exact time slot also recorded three block trades of long put options, including one where the active buyer paid a $22.98 million premium for 5,000 contracts that give the holder the right to sell 500,000 shares at $225 each.
The two other block trades were for long put options: one where the buyer paid a $21.27 million premium for the right to sell 280,000 shares at $255 each and one with a $12.31 million premium for 220,000 shares that can be sold at $235 each.
Tesla's stock has tumbled this year, losing its spot in the top 10 biggest companies as demand for electric vehicle wanes and competition intensified. In the fourth quarter of 2023, the company led by billionaire Elon Musk was also stripped of its crown as the world's largest EV maker, with its Chinese rival $BYD Co. (BYDDF.US)$ gaining that title.
While the stock rose on Thursday, technical indicators that have recently turned bullish now seem to be divided. Seven of the 15 measures tracked by Moomoo are flagging that the stock is oversold and the trend is bullish, while one is warning that it's still overbought and relatively bearish. The rest are neutral.
Disclaimer:
Options trading entails significant risk and is not appropriate for all customers. It is important that investors read Characteristics and Risks of Standardized Options before engaging in any options trading strategies. Options transactions are often complex and may involve the potential of losing the entire investment in a relatively short period of time. Certain complex options strategies carry additional risk, including the potential for losses that may exceed the original investment amount. Supporting documentation for any claims, if applicable, will be furnished upon request. Moomoo does not guarantee favorable investment outcomes. The past performance of a security or financial product does not guarantee future results or returns. Customers should consider their investment objectives and risks carefully before investing in options. Because of the importance of tax considerations to all options transactions, the customer considering options should consult their tax advisor as to how taxes affect the outcome of each options strategy.
Options trading entails significant risk and is not appropriate for all customers. It is important that investors read Characteristics and Risks of Standardized Options before engaging in any options trading strategies. Options transactions are often complex and may involve the potential of losing the entire investment in a relatively short period of time. Certain complex options strategies carry additional risk, including the potential for losses that may exceed the original investment amount. Supporting documentation for any claims, if applicable, will be furnished upon request. Moomoo does not guarantee favorable investment outcomes. The past performance of a security or financial product does not guarantee future results or returns. Customers should consider their investment objectives and risks carefully before investing in options. Because of the importance of tax considerations to all options transactions, the customer considering options should consult their tax advisor as to how taxes affect the outcome of each options strategy.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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Luzi Ann Santos
Moomoo Senior News and Community Manager
Former editor at Bloomberg, ex-commentary editor at Lazard. Posts aren’t investment advice. Views are just mine.
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SPACELIGHT : How cool is that...![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
71537923 : How could a stock option columnist don’t know how option spread work… go learn your option 101 and know what bullish and bearish spread strategies looks like.
71399351 : good read ... tho for me wouldn't it have been a more the timely article if posted pre -market or last night?
103736451 : $MAYBANK (1155.MY)$
72866798 : if they long the more expensive Put option and short the less expensive one, then it means that they are bearish using vertical spread on TSLA for next week