B. Riley Financial is a company that helps other companies with different things like selling their stuff, talking to people, and making products. Some people are interested in buying or selling parts of this company called options. They can make more money if they guess right, but also lose more money if they guess wrong. The price of the company is going up a little bit, but some indicators say it might be too high. The company will tell us how it's doing in two days. People who want to learn about this company and its options can use Benzinga Pro to get notifications when something happens. Read from source...
1. The title of the article is misleading and sensationalized. It implies that there is a hidden agenda or secret insight behind what the "big money" is thinking, which is not necessarily true. A more accurate and neutral title could be something like "B. Riley Financial's Options: An Overview of Recent Trading Activity".
2. The article starts by mentioning that the stock price is up by 3.3%, but it does not provide any context or explanation for this increase, such as news events, earnings reports, or market trends. This leaves the reader wondering why the stock is performing well and what factors are influencing its movement.
3. The article mentions that the current RSI values indicate that the stock may be overbought, but it does not explain what this means or how it affects the trading decision. A brief definition of RSI (Relative Strength Index) and its implications for overbought conditions could have been useful for readers who are not familiar with technical analysis.
4. The article ends by promoting Benzinga Pro, a subscription service that provides real-time alerts on options trades. This is an obvious attempt to generate revenue from the website's traffic and does not contribute to the quality or objectivity of the article. A more appropriate conclusion could have been something like "To learn more about B. Riley Financial's options trading activity, we encourage you to review the company's filings with the SEC and consult a professional financial advisor".
Given that B. Riley Financial has a diverse portfolio of segments, including financial consulting, auction and liquidation, communications, and consumer products, I would recommend the following options trades for different risk appetites and expected returns:
- For aggressive traders who are willing to take higher risks and aim for higher profits, I would suggest buying the RILY Nov 19 $37.50 call options with a strike price of $37.50 and an expiration date of November 19th. This trade has a current bid of $1.20 and offers a potential return of up to 448% if the stock reaches or exceeds $37.50 by the expiration date. However, this trade also carries a high risk of loss if the stock does not reach the target price, as the premium paid for the call options is significant and may not be recovered even if the stock moves in favor of the trade.
- For moderate traders who are looking for a balance between risks and returns, I would recommend selling the RILY Oct 29 $34 put options with a strike price of $34 and an expiration date of October 29th. This trade has a current ask of $1.50 and offers a potential return of up to 150% if the stock closes below $34 by the expiration date, which would result in a purchase obligation for the sellers at $34 per share. However, this trade also exposes the sellers to a loss if the stock stays above $34 and expires worthless, as they would have to buy the stock at the market price and sell it at the strike price, resulting in a net loss. The risk of loss is limited to the premium received for selling the put options, which is $1.50 per contract.
- For conservative traders who are seeking lower risks and returns, I would advise buying the RILY Oct 29 $34 call options with a strike price of $34 and an expiration date of October 29th. This trade has a current bid of $1.50 and offers a potential return of up to 56% if the stock reaches or exceeds $34 by the expiration date, as the sellers of the call options would have to deliver the stock at the strike price upon exercise. However, this trade also limits the upside potential of the stock, as the buyers of the call options can only profit if the stock rises above the strike price and expires worthless, resulting in a net profit of $3 per share ($34 - $31). This trade is less risky than buying the stock outright