One of the top-performing stocks of the past year, at least one trader sees a drop ahead forNvidia (NVDA). That’s evidenced by the January 2022 $450 puts. Over 1,060 contracts traded hands, a 6-fold rise over the 180 contracts with open interest. Expiring in 458 days, the bet would move in-the-money if shares dropped 18 percent from their current price around $548 per share. The trader paid about $58.50 per contract on average. The graphics processing company is up 181 percent in the past year, or more than 10 times that of the S&P 500 index. With a beta of 1.5, shares are about ...

Over 5,300 contracts traded on a January 2023 $4 call option onGeneral Electric (GE). That’s a 19-fold rise in volume against the prior open interest of just 285 contracts. The option, expiring in 823 days, is over $3 in-the-money, given the current share price at $4. For the option buyer to profit at expiration, shares need to trade at $8 or higher. The trade comes as GE continues to struggle, as profits from its aviation division have dried up, leading to a big drop in shares. The company’s work to streamline operations and focus on its industrial businesses over the past few years...

Over 2,000 contracts traded on January 2023 $30 puts onWells Fargo (WFC). That’s a 16-fold increase in interest given the prior 122 open contracts in the trade. The puts, which are about $7 in-the-money, expire in 826 days. The long-dated trade, known as a LEAP, is a bet that the bank’s shares will head lower. The trader paid just over $10.00, so shares will need to trade under $20 at expiration for the trade to profit. Shares of the megabank are down this week following a lackluster earnings report. The company is still dealing with the fallout from the faked account scandal of a fe...

Over 3,200 contracts traded on the February 2021 $30 calls onSocial Capital Hedosophia Holdings Corp (IPOB). That’s a 28-fold increase in volume from the prior number of open contracts near 117. With shares trading around $26, shares need to rally about 15 percent for the option contract to move in-the-money. The call buyer paid about $3.10 on average for the options, which expire in 127 days. IPOB is a SPAC, a specialty purpose acquisition company. Also known as a “blank check company” many SPACs have a deadline to either make an acquisition or dissolve, returning capital to shareho...

Over 1,950 contracts traded on the November 27th $25 calls onCarnival Cruise (CCL). The prior open interest on the trade was 137 contracts, showing a 14-fold rise in volume. The trade, expiring in 44 days, has a strike price 75 percent higher than where shares currently trade around $14.25. With that big of a price difference, it’s no surprise that the buyer of the contract only paid about $0.13, or just $13 per contract, on average. As it’s unlikely for shares of the cruise line to soar that much that quickly, as shares only once briefly touched $25 since the outbreak of Covid-19. T...

Nearly 9,100 contracts traded on the June 2021 $640 calls onTesla Motors (TSLA) recently. That’s a 12-fold rise over the prior open interest of 766 contracts. The trade, expiring in 248 days, would require shares to rally about 45 percent from their current price. The option buyer paid about $51.90, or $5,190 per contract to make the far out-of-the-money trade. Shares of the company have been one of the top performers in the past year. While a 45 percent move in shares of most companies seems implausible, it would be on the lower end of the return scale for Tesla. The electric vehicl...

Nearly 2,100 contracts traded on the November 20th $110 puts onXilinx (XLNX) recently. The trades amounted to an 18-fold rise in volume on the trade based on the prior open interest of 114 contracts. Expiring in 39 days, the trade is a bet that shares will shed about $9 from their current price near $119. Shares of the tech company soared on Friday on the announcement that Advanced Micro Devices was in advanced talks to buy the firm. The buyer of the option expects the price to come down, either because of anti-trust fears or because the deal ends up falling apart. If that happens, s...

Over 4,100 contracts traded on May 2021 $16 calls onAmerican Airlines (AAL). That’s a 40-fold rise in volume from the prior open interest near 100 contracts. The bet, expiring in 224 days, would require shares to rally to $16 from their current price near $13.50. That’s about an 18.5 percent return. The trader paid about $2.70 for the contracts on average. This bet comes as the airline industry struggles to reach passenger traffic one-third the level of this time a year ago. And, as of October, government funding for the airline industry specifically has run out. A number of airlines...

With a 33-fold rise in volume on the October 30th $50 calls, one trader is betting on a big move higher inLas Vegas Sands (LVS) this month. With 22 days until expiration, the call would require shares to rally about 10 percent for the trade to move in-the-money. The option buyer paid about $1.26 on average for the option, so shares would need to rally quickly and strongly to offset the declining time premium on the contract. Gaming companies have seen significantly lower traffic as a result of government shutdowns this year. Many companies are open at limited capacity, which will lik...

One trader is betting that shares ofApplied Materials (AMAT) will soar in the next two days. That’s because over 6,100 contracts traded on Friday’s $63.50 calls, a 42-fold surge in volume. With shares currently trading around $61.50, the option is about 3.3 percent out-of-the-money. The option buyer paid about $0.30, or $30 per contract. While inexpensive, the option stands a good chance of expiring at zero come Friday. Shares of the chipmaker have traded as high as $70 twice this year, first in February and then again in August. As with many tech companies, it’s been a volatile name...