Some big people who have a lot of money are betting on what they think the price of Ford cars will be. They use special things called options to do this. Options let them buy or sell Ford cars at a certain price in the future. The important prices that these big people care about are between $7.17 and $21.82. If the price of Ford cars goes up or down, they can make more money. Read from source...
- The title of the article is misleading and clickbait, as it implies that there are some insider or expert opinions on what whales are betting on Ford Motor, when in reality, the article only provides data on options trading volumes and prices.
- The author uses vague terms like "whales" and "big money trades" without defining them or providing any context or evidence for their existence or significance.
- The article lacks a clear structure and logical flow, as it jumps from presenting the data on options trading to describing Ford's business strategy and recent announcements, without explaining how they are related or relevant to the main topic of whales betting on Ford Motor.
Based on the information provided in the article, I would say that the sentiment is mostly neutral with a slight leaning towards bearish. This is because whales are betting on a range of prices for Ford Motor, which suggests they do not see a clear trend or direction for the stock. Additionally, the volume and open interest are relatively high, but not exceptionally so, indicating that there may be some uncertainty or caution among investors.
Given that whales have been targeting a price range from $7.17 to $21.82 for Ford Motor over the last 3 months, it might be worth considering a bullish strategy with a stop-loss below this range. For example, you could buy a June $15 call option with a bid of $0.90 or lower and sell a June $10 put option with a bid of $0.45 or higher. This would create a net credit of $0.45 per contract, which represents the maximum potential gain if Ford Motor stays above $15 by expiration date. The risk is limited to the difference between the strike prices minus the premium received, which is $3.85 ($15 - $10) - ($0.90 + $0.45) = $2.40 per contract. Therefore, your maximum potential gain is 63.48% and your risk-reward ratio is approximately 1:7.
Alternatively, you could buy a June $20 call option with a bid of $0.60 or lower and sell a June $15 put option with a bid of $0.45 or higher. This would create a net debit of $1.35 per contract, which represents the maximum potential loss if Ford Motor falls below $15 by expiration date. The risk is limited to the difference between the strike prices minus the premium paid, which is $2.85 ($20 - $15) - ($1.35 + $0.45) = $1.70 per contract. Therefore, your maximum potential loss is 69.23% and your risk-reward ratio is approximately 1:5.