This article talks about a company called Futu Holdings, which helps people trade stocks and other things. Some rich people who know a lot about this company made special choices with their money that usually don't happen. This might mean they think something big is going to happen with the company soon. They used different kinds of options, like puts and calls, to make these choices. The article also talks about how these rich people are looking at certain prices for the company's stock, between $50 and $95. Read from source...
1. The article title is misleading and sensationalized. It implies that there are some hidden or secretive trends behind Futu Hldgs's options trading activities, which is not supported by the rest of the text. A more accurate title could be "Some Uncommon Options Trades for Futu Hldgs".
2. The article uses vague and ambiguous terms to describe the options trades, such as "uncommon", "big-money", "special", and "big happens". These terms do not provide any specific or meaningful information about the nature or size of the trades, and may appeal to emotions rather than logic.
3. The article does not explain how it obtained the data for the options scanner, nor does it provide any details on the methodology or criteria used to identify the trades as "uncommon" or "special". This raises questions about the validity and reliability of the data and the analysis.
FUTU has shown strong growth potential in recent years, but also faces challenges from increased regulatory scrutiny and competition from other online brokerage platforms. Based on the options trends analysis, it seems that some big-money traders are betting on a price drop for FUTU, while others are more bullish and anticipating a rebound in the stock price. Therefore, I would recommend investors to consider the following strategies: - A covered call strategy, where they sell call options on FUTU with a strike price close to the current market price, and collect premiums as income while maintaining their long positions in the stock. This can reduce the cost basis of the shares and limit potential losses in case of a bearish scenario, while also benefiting from capital appreciation if the stock rallies above the option strike price. - A protective put strategy, where they buy put options on FUTU with a strike price below their current market value, and use them as insurance against a possible downside risk. This can act as a hedge against unforeseen events or volatility spikes that could negatively affect the stock price, while also preserving their upside potential if the stock performs well. - A collars strategy, where they combine both covered call and protective put options on FUTU with different strike prices, to create a range of protection and profitability around their current market value. This can help them reduce the risk of large losses or excessive gains, while also generating consistent income from option premiums. The downside is that they will have to allocate some of their capital for both call and put options, which may limit their leverage and upside potential in case of a significant stock price movement. - A speculative strategy, where they take advantage of the options pricing discrepancies and volatility expectations of different traders, by buying either call or put options on FUTU with strike prices that are significantly away from the current market price. This can offer them a high upside potential in case their predictions about the future direction of the stock price prove to be correct, while also limiting their downside risk if they choose the right option type and expiration date. The risks are that they may lose their entire investment if the stock moves against their expectations, or if they misjudge the market sentiment and options premiums. The best strategy for each individual investor will depend on their risk tolerance, time horizon, and personal preferences. Therefore, I would advise them to consult with a professional financial advisor before making any decisions regarding FUTU's options.