I am a newbie investor and grateful to have found this board.
I invested in a Paypal a few weeks ago.
I read this article about “Heavy Put buying targets Paypal” for puts expiring Oct 30.
After reading Neil’s feedback on BOFI, and the possibility of a short seller attack having caused the sudden 15% drop on Friday to push the prices close to $100, I am trying to understand how this might unfold for Pypl.
Could anyone provide any resources for me to understand this better?
There’s actually much heavier calls open at the closer strikes, but yes, on 9/29 and 9/30 there were about 15k contracts exchanged each and on 10/8, another 20k. That strike has the most open interest, so most are still open.
You can’t be sure they were bought and not sold, but given they drove the price up on the buys it looks like they were bought, but you also don’t know if someone is hedging a large portfolio position ahead of earnings, which is most likely
Most of those articles are written by an algorithm and are more clickbait than articles. Heavy option activity is a piece of information that you can use along with everything else, but not enough alone to change your investment thesis. There are plenty of reason people use options.