Posts Tagged ‘BABA’

Alibaba Options In Focus

Options volume on Alibaba Group Holdings is poised to end at the session at approximately three times the average daily level, with volume in BABA contracts approaching 300,000 contracts versus average daily volume of 105,000 contracts and less than 30 minutes to go before the closing bell. Shares in BABA are down 3.0% as of the time of this writing to stand at $81.50, off the intraday and fresh 52-week low of $80.03 set earlier this afternoon.

Across all available expiries, the 80.0 strike put options are seeing notable activity, with cumulative volume in excess of 30,000 contracts. As for trading in BABA calls across available expiries, the 85.0, 87.5 and 90.0 strike contracts attracted the most action.

Chart – Above average day for Alibaba options volume


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A Look At How BABA Options Are Trading

Alibaba (Ticker: BABA) options have been trading for one week. Let’s take a look at where options traders have accumulated the most positions in BABA call and put options. Per the below chart, the 90.0 strike calls and puts are by far the most held options contracts across all available expiries on the Chinese e-commerce giant. All told, it looks like there are approximately 52,000 contracts held at the 90.0 strike level, or roughly 17% of total open interest on the name of 312,000 contracts. The call/put interest ratio of approximately 1.5 on Alibaba indicates more of the open interest held of investors is in call options versus puts on the stock. Shares in BABA today are roughly flat on the session to stand at 88.20, and options traders have exchanged a little more than 22,000 contracts versus the stock’s average daily options volume of 99,000 contracts.

Chart – BABA Open Interest as of 10/06/14


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IV Implodes On 4-hour YHOO Options As BABA Commences Trading

Investors are dumping shares in Yahoo, sending the stock down 5.0% to $40.08 after shares in Alibaba made their debut on the floor of the NYSE just before midday. Shares in BABA for their part initially traded up to a high of $99.70, a near 47% increase over the IPO price of $68.00. Typically, one would expect put options that are 5% out of the money with roughly 4-hours left to trade to see waning implied volatility. But, at the start of the trading session and ahead of the first trade for BABA, the Sep 19 ’14 40.0 strike put options were trading with 271% volatility or $0.30 per contract amid uncertainty as to how the start of trading for Alibaba would take shape.

After shares in BABA debuted, volatility in the 40.0 strike puts imploded, dropping almost immediately to 154% and sending premium on the contracts down to as low as $0.04 each. However, with shares in BABA at $90.70 as of 12:30 p.m. ET and having backed off of their intraday highs to trade below the initial traded price of $92.70, selling pressure on Yahoo is increasing and premium on those YHOO 40.0 strike puts has ripped to the upside. At last check, the 40.0 strike put options with just hours to go before expiration are changing hands at $0.60 apiece at roughly 150% implied volatility.

Overall volume in Yahoo options has surpassed 1 million contracts, more than twice the stock’s average daily options volume of 453,000 contracts.


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Fabulous Friday – Our AliBaba Play Pays off Big!

We're already up over 100% on Alibaba.

How, you may wonder?  Well, two ways:  Back in October of 2007, before Alibaba IPO'd in China, I was touting the company when it had an $8Bn valuation ($1.10 per  share – pre-split).  I was the first and only analyst in the US to point out the benefits of Yahoo's investment back then and our Members who play the Asian markets were able to take advantage of that and today should be the culmination of the white whale of investing – the 20-bagger as Alibaba is expected to IPO in the US at $160Bn just 7 years later

YHOO, on the other hand, took the long and winding road but it should finally be getting to our $50 target and that's another 100% gain on the stock – though a very small consolation to those who didn't pick up AliBaba directly.  Fortunately, at Philstockworld, we know how to BE THE HOUSE – Not the Gambler and, back in June, when the rumors of the AliBaba IPO began we came up with a way for our Members to make 400% playing YHOO into the AliBaba IPO.  

From our Live Member Chat Room:

YHOO/Albo – Why not just buy YHOO?  YHOO is $35Bn and owns 22% of AliB while SFTBY is $91Bn and owns 33% of AliB, so you get a lot more bang for your buck with YHOO, whose forward p/e is only 19, than SFTBY, whose forward p/e is about 17 – so not all that significant.  Of course, more significantly is the potential impact of (guessing) $50Bn worth of AliB on a $35Bn company!  

So we don't even have to go crazy if we want to play the "YHOO is undervalued" game.  The Jan $38/45 bull call spread is $1.60 on the $8 spread with 400% upside if YHOO gains 28%.  I think that's worth $800 for 5 shares in the $25KP


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Phil's Favorites

The PhilStockWorld.com Weekly Webinar - 05-27-2020

For LIVE access on Wednesday afternoons, join us here at Phil's Stock World!

 

Major Topics:

00:01:40 - Yang 4 Day Work Week
00:12:21 - DIS
00:19:01 - Bonds
00:25:49 - COVID-19 Update
00:41:12 - Trading Techniques
00:45:18 - US Corporate Taxes
00:52:27 - US National Debt
01:04:36 - Beige Book
01:09:25 - Hedge Funds
01:10:08 - States Reopening
01:14:16 - May Portfolio Review
01:14:52 - STP & LTP
01:26:38 - PAA & Strategy Section
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Biotech/COVID-19

How coronavirus contact tracing works in a state Dr. Fauci praised as a model to follow

 

How coronavirus contact tracing works in a state Dr. Fauci praised as a model to follow

Pairing widespread testing with fast, effective contact tracing is considered essential for controlling the coronavirus’s spread as the U.S. passes 100,000 deaths. AP Images/Rick Bowmer

Courtesy of Jenny Meredith, University of South Carolina

After weeks of keeping people home to “flatten the curve,” restrictions on U.S. businesses are loosening and the coronavirus pandemic response is moving ...



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ValueWalk

Don't expect a second round of stimulus checks in June

By Michelle Jones. Originally published at ValueWalk.

Lawmakers from both parties are finally starting to agree that a second round of coronavirus stimulus checks may be needed. However, they are still a long way from making a final decision that will actually result in another round of checks for everyone. Here’s the current status on a second round of stimulus checks.

Q1 2020 hedge fund letters, conferences and more

Coronavirus stimulus checks: second round status

The Democrat-led House of Representatives passed the Health and Ec...



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Zero Hedge

Futures Tread Water In Calm Before US-China Storm, Trump Twitter Crackdown

Courtesy of ZeroHedge View original post here.

The S&P's remarkable stretch of posting gains in the overnight session continued for another day, with the S&P rising as high as 3,053, and last trading 9 points higher at 3,044, tracking global stocks higher, with Europe's Stoxx 600 rising 1.3% to session highs as investors weighed again increased friction between America and China and the official passage of China's National Security Law in defiance of Trump, against fresh fiscal stimulus promised by the European Union. Treasuries edged up, while the dollar was modestly lower even as traders "treaded water...



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Kimble Charting Solutions

Tech Indicator Suggesting A Historic Top Could Be Forming?

Courtesy of Chris Kimble

Tech stocks have been the clear leader of the stock market recovery rally, this year and since the lows back in 2007!

But within the ranks of leadership, and an important ratio may be sending a caution message to investors.

In today’s chart, we look at the ratio of large-cap tech stocks (the Nasdaq 100 Index) to the broader tech market (the Nasdaq Composite) on a “monthly” basis.

The large-cap concentrated Nasdaq 100 (only 100 stocks) has been the clear leader for several years versus the ...



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The Technical Traders

M2 Velocity Collapses - Could A Bottom In Capital Velocity Be Setting Up?

Courtesy of Technical Traders

M2 Velocity is the measurement of capital circulating within the economy.  The faster capital circulates within the economy, the more that capital is being deployed within the economy to create output and opportunities for economic growth.  When M2 Velocity contracts, capital is being deployed in investments or assets that prevent that capital from further circulation within the economy – thus preventing further output and opportunity growth features.

The decline in M2 Velocity over the past 10+ years has been dramatic and consistent with the dramatic new zero US Federal Reserve interest rates initiated since just after the 2008 credit crisis market colla...



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Lee's Free Thinking

US Southern States COVID19 Cases - Let's Give Credit Where Due

 

US Southern States COVID19 Cases – Let’s Give Credit Where Due

Courtesy of  

The number of new COVID 19 cases has been falling in the Northeast, but the South is not having the same experience. The number of new cases per day in each Southern state has been rangebound for the past month.

And that’s assuming that the numbers haven’t been manipulated. We know that in Georgia’s case at least, they have been. And there are suspicions about Florida as well, as the State now engages in a smear campaign against the fired employee who built its much praised COVID19 database and dashboar...



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Chart School

Is this your local response to COVID 19

Courtesy of Read the Ticker

This is off topic, but a bit of fun!


This is the standard reaction from the control freaks.








This is the song for post lock down!







What should be made mandatory? Vaccines, hell NO! This should be mandatory: Every one taking their tops off in the sun, they do in Africa!

Guess which family gets more Vitamin D and eats less sugary carbs, TV Show



...



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Digital Currencies

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

 

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

App-etising? LDprod

Courtesy of Michael Rogerson, University of Bath and Glenn Parry, University of Surrey

Food supply chains were vulnerable long before the coronavirus pandemic. Recent scandals have ranged from modern slavery ...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

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Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

This week, we also have a special presentation from Mike Anton of TradeExchange.com. It's a new service that we're excited to be a part of! 

Mike will show off the TradeExchange's new platform which you can try for free.  

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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