Unusual Options Activity: Roblox Corporation (RBLX)

Shares of metaverse gaming platform Roblox Corporation (RBLX) are down nearly 50 percent in the past year on a drop in tech stocks. One trader sees the potential for a jump higher in the coming days.

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  • That’s based on the October 7th $45 calls. With 16 days until expiration, 4,847 contracts traded compared to a prior open interest of 155, for a 31-fold increase in volume on the trade. The buyer of the calls paid $0.51 to make the bet.

    Shares recently traded around $37, so they would need to rise about 22 percent in just over two weeks for the option to close in-the-money. The stock has just had a sharp drop over the past week, with the stock losing nearly 20 percent, so such a rebound could happen.

    The company is still in its early stages and losing money overall, but it increased its revenue over 30 percent to $2.21 billion in the last year. And the platform remains one of the most popular metaverse options right now, with a massive popularity among a younger crowd.

    Action to take: Shares will likely move higher in time, although there may still be some short-term weakness. Investors should look to start accumulating the stock here, and take advantage of any further drops in the coming weeks.

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  • For traders, the options are inexpensive, and could deliver high returns on a jump in shares. As the company doesn’t report earnings next until November, such a move could come from a macro event that causes a stock rally.


    Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.