In anticipation of cabinet-level talks between the US and China, options traders are banking on positive outcomes for Alibaba Group Holding Limited BABA and have heavily invested in the company’s stock.
Kelly Intelligence’s Kevin Kelly disclosed that the trading volume was high in Alibaba’s shares on Thursday, with around 2.87 times more calls than puts on the stock.
On Thursday, buyers acquired 16,649 of the July 100-calls at an average price of 85 cents per contract, speculating that Alibaba will surge by at least 27% by July expiration.
Alibaba recently unveiled plans to employ 15,000 people in 2023, contradicting rumors of downsizing.
At the close of Thursday, Alibaba’s shares dropped by 3%, trading at $78.78; however, it increased by 1.4% in premarket on Friday.
For further early market insights, premarket coverage is available.
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