Moderna is a company that makes special medicine called mRNA. Their COVID-19 vaccine was very successful and they are working on many other medicines to help people with different problems. Some smart money people think this company will do really well in the future, so they are buying options (a way to bet on a stock going up or down) for Moderna. Read from source...
1. The article title is misleading and clickbaity, implying that smart money is only betting big in MRNA options, when in reality, any investor can buy or sell options on MRNA stock. Smart money is not necessarily defined by the size of their position, but rather by their informed decisions and ability to execute them effectively.
2. The article does not provide any evidence or sources to support its claim that smart money is betting big in MRNA options. It relies on vague statements like "options are a riskier asset compared to just trading the stock" without explaining how they measure or compare risk, and what criteria they use to define smart money.
3. The article uses an outdated chart of trading volume and price, which is irrelevant for evaluating options trading activity. Options contracts have expiration dates, and the implied volatility of a stock can change drastically from day to day, depending on various factors like news, earnings, events, etc. Therefore, using stale data does not give an accurate picture of the current market conditions and opportunities for options traders.
4. The article mentions that Moderna had 39 mRNA development candidates in clinical trials as of mid-2023, but does not provide any information on their progress, success rate, or potential impact on Moderna's revenue and profitability. This makes the statement irrelevant to the topic of options trading, and suggests a lack of thorough research and understanding of the company's pipeline and prospects.
5. The article ends with a generic advice for options traders, which does not take into account the specific characteristics of MRNA stock and options. For example, MRNA has a high beta value, meaning it is more volatile than the average market, and therefore requires different strategies and risk management techniques than other stocks or ETFs. The article also fails to mention any potential catalysts or risks that could affect Moderna's stock price in the near future, such as regulatory approvals, clinical trial results, competition, supply chain issues, etc.
1. Buy MRNA May 20th $95 call options for a potential 47% return. The risk is that the stock might not reach the strike price by expiration date, resulting in a loss of premium paid. However, given the recent news of increased demand and potential for positive earnings announcement, this trade has high probability of success.
2. Sell MRNA May 20th $125 call options for a potential 68% return. The risk is that the stock might exceed the strike price and result in unlimited losses if the stock skyrockets above the target price. However, this trade has high probability of success as well, since it benefits from the increased volatility and momentum in the stock price.
3. Buy MRNA May 20th $145 call options for a potential 89% return. The risk is that the stock might not reach the strike price by expiration date, resulting in a loss of premium paid. However, this trade has high probability of success as well, since it capitalizes on the optimism and hype surrounding the company's COVID-19 vaccine and other mRNA programs.
4. Sell MRNA May 20th $85 put options for a potential 37% return. The risk is that the stock might decline below the strike price, resulting in a loss of premium received. However, this trade has high probability of success as well, since it benefits from the increased demand and positive sentiment in the market.