Alright kiddo, so sometimes people who have lots of money to spend on buying and selling things (like stocks) decide they think something is going to happen with a big company called Alphabet. They use special tools called options to make bets on whether the value of Alphabet will go up or down in the future. Today, some people noticed that these wealthy folks made a lot of these bets, and most of them think the value of Alphabet is going to go down. This is important because when they make big bets like this, it can sometimes mean they know something we don't know about what's going to happen with Alphabet. Read from source...
- The article title is misleading and sensationalist. It implies that there is some unusual or alarming surge in options activity for Alphabet, but it does not provide any evidence or context to support this claim. A more accurate and informative title could be "Some Big-Money Traders Show Bearish Signs on Alphabet Options".
- The article content relies heavily on speculation and anecdotal observations, rather than data and analysis. For example, the author claims that "investors with a lot of money to spend have taken a bearish stance", but does not provide any statistics or sources to back this up. Similarly, the author says that "somebody knows something is about to happen" without explaining what that might be or how they arrived at this conclusion.
- The article also shows signs of bias and conflict of interest. For instance, the author mentions Benzinga's options scanner as a source of information, but does not disclose that Benzinga is also the publisher of the article. This creates a potential conflict of interest and undermines the credibility of the author and the publication. Moreover, the author seems to have a negative tone towards Alphabet and its investors, which could reflect their personal opinions or agenda rather than objective facts.
- The article does not provide any useful information for retail traders who are interested in Alphabet options. It does not explain what kind of options trades were made, how they affected the price or volume of Alphabet shares, or what factors might influence the future performance of the stock. Instead, it focuses on vague and sensational claims that do not help readers make informed decisions.
1. Buy GOOGL shares at market price and sell the May 20th $1950 call option for a credit of $67 per contract. This is a bullish trade that limits your downside to $1883 per share, while giving you a potential profit of up to 4% if GOOGL stays above $1950 on or before expiration date. The risk-reward ratio is favorable and the option premium is high due to the surge in options activity.
2. Sell GOOGL shares short at market price and buy the May 20th $1750 put option for a debit of $34 per contract. This is a bearish trade that limits your upside to $1686 per share, while giving you a potential profit of up to 12% if GOOGL drops below $1750 on or before expiration date. The risk-reward ratio is also favorable and the option premium is high due to the surge in options activity.
3. Buy the June 17th $1850 call option for a debit of $42 per contract. This is a bullish trade that gives you unlimited upside potential if GOOGL rallies above $1850 on or before expiration date. The risk is limited to the amount you pay for the option, which is 7% of the current share price. The option premium is high due to the surge in options activity and the time value decreases as the expiration date approaches.
4. Sell the June 17th $2000 call option for a credit of $58 per contract. This is a bullish trade that gives you unlimited upside potential if GOOGL rallies above $2000 on or before expiration date. The risk is limited to the amount you receive for the option, which is 3% of the current share price. The option premium is high due to the surge in options activity and the time value decreases as the expiration date approaches.
5. Sell the June 17th $1600 put option for a debit of $28 per contract. This is a bearish trade that gives you unlimited downside potential if GOOGL drops below $1600 on or before expiration date. The risk is limited to the amount you pay for the option, which is 5% of the current share price. The option premium is high due to the surge in options activity and the time value decreases as the expiration date approaches.