Some big and rich people think that the company called Robinhood Markets will lose money in the future, so they are buying things called options to make money if that happens. This is unusual because it doesn't happen very often. The big and rich people are split on whether they think Robinhood Markets will go up or down in price, but most of them are betting that it will go down. People who follow the stock market should pay attention to this because it might mean something important is going to happen with the company soon. Read from source...
- The article title is misleading and clickbait, implying that there is something unusual or suspicious about the options activity of Robinhood Markets. However, the article does not provide any evidence or explanation for why this is the case, nor what it means for retail traders.
- The article relies on vague terms like "a lot of money to spend", "big-money traders", and "somebody knows something is about to happen" without defining them or providing any data or sources to support these claims. This creates a sense of mystery and speculation, rather than informing the reader about the actual options market dynamics and trends.
- The article uses outdated information, such as mentioning the price band between $10.0 and $25.0 for Robinhood Markets, spanning the last three months. This is irrelevant to the current options activity that the article claims to analyze, and shows a lack of up-to-date research and analysis.
- The article does not provide any context or background information about Robinhood Markets, such as its business model, products, services, market position, or performance. This makes it difficult for the reader to understand why this company is relevant or interesting in the options market, and what factors may influence its stock price.
- The article does not explain how it calculated the overall sentiment of the big-money traders, nor how it determined the put/call ratio. It also does not show any charts or tables to visualize the data and trends that it claims to have found. This makes it hard for the reader to verify or interpret the findings, and raises questions about the accuracy and validity of the analysis.
- The article ends with a snapshot of the options volume and open interest, without any commentary or explanation of what it means, how it relates to the previous information, or why it is important for retail traders. This leaves the reader confused and unsatisfied, as they are not given any actionable insights or advice from the article.
The overall sentiment of the big-money traders is split between 46% bullish and 53%, bearish. However, considering that these are not normal trades and that they involve large amounts of money, I would say the article's sentiment leans more towards negative for Robinhood Markets.
1. Sell HOOD puts at the $25 strike price with a 30-day expiration date, targeting a premium of 2% or higher. This strategy can generate income for investors who are bullish on HOOD's price movement in the short term and believe it will not go below $25 by expiration date. The risk is limited to the premium received if HOOD goes up or remains above $25.
2. Buy HOOD calls at the $10 strike price with a 30-day expiration date, targeting a premium of 4% or higher. This strategy can benefit from significant upside potential if HOOD's price rallies above $10 and reaches the call strike price by expiration date. The risk is limited to the premium paid if HOOD does not go up significantly from the current price.
3. Sell HOOK calls at the same strike price as the ones bought in option 2, targeting a similar or higher premium. This strategy can create a bear spread by selling a call with a lower probability of being in-the-money at expiration date and collecting more premium than the one sold. The risk is limited to the difference between the two premiums received if HOOK's price moves within the range of the strike prices.
4. Buy HOOD shares and write covered calls at a strike price above the current market price, targeting a premium of 5% or higher. This strategy can generate income from dividends and capital appreciation while limiting downside risk by selling call options that expire in several months or years. The risk is limited to the difference between the share price and the strike price if HOOK's price goes up significantly or the calls are exercised before expiration date.