United Parcel Service, Inc. (NYSE:UPS) shares are up 70.4% in the past three months. The delivery giant appears to have gotten a boost from shelter-in-home environment, and at least one large option trader is making a huge bet on more upside ahead.
The UPS Trades: On Monday, Benzinga Pro subscribers received two option alerts related to unusually large UPS trades:
- At 9:39 a.m., a trader bought 346 UPS call options with a $162.50 strike price expiring on Friday above the ask price at 88.3 cents. The trade represented a $3,055.18 bullish bet.
- At 12:05 p.m, a trader bought 750 UPS call options with a $120 strike price expiring on Jan. 15 2021 at the ask price of $42.25. The trade represented a more than $3.16 million bullish bet.
Why It’s Important: Even traders who stick exclusively to stocks often monitor option market activity closely for unusually large trades. Given the relative complexity of the options market, large options traders are typically considered to be more sophisticated than the average stock trader.
Many of these large options traders are wealthy individuals or institutions who may have unique information or theses related to the underlying stock.
Unfortunately, stock traders often use the options market to hedge against their larger stock positions, and there’s no surefire way to determine if an options trade is a standalone position or a hedge. In this case, given the relatively large size of Monday’s largest UPS option trade, it could certainly be institutional hedging.
Delivering The Gains: UPS shares traded higher on Monday without any major news from the company. UPS been on fire in recent months, as the combination of low fuel prices and soaring delivery demand propelled the company to a huge second-quarter earnings beat.
UPS reported a 20.9% jump in overall volumes, including a 22.8% gain in domestic volumes and a 65% increase in business-to-consumer deliveries in the quarter.
Looking ahead to the third quarter, there’s no obvious reason to think there will be a significant change in customers’ behavior given the COVID-19 outbreak is ongoing. In the longer-term, UPS investors may be speculating that some of the pandemic related shifts in shopping behavior may stick even after the worst of the pandemic subsides, creating a better baseline environment for UPS.
Benzinga’s Take: The fact that the January calls expire more than five months from now suggests the trader isn’t making a play on near-term bullish momentum or even third-quarter earnings. The trader may simply be betting that the shelter-in-place environment drives a massive amount of holiday season shopping online, creating a late-year surge in UPS deliveries.
The January calls have a break-even price of $162.25, suggesting the stock needs to gain only about 0.4% over the next five months for the trader to turn a profit on the calls.
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联合包裹服务公司(United Parcel Service,Inc.)(纽约证券交易所代码:UPS)的股价在过去三个月里上涨了70.4%。这家快递巨头似乎从居家环境中获得了提振,至少有一家大型期权交易员正大举押注未来会有更多上行空间。
UPS交易:周一,Benzinga Pro的订户收到了两个与异常大的UPS交易有关的期权警报:
- 上午9点39分,一名交易员买入346UPS看涨期权,执行价为162.50美元,周五到期,高于卖出价88.3%。这笔交易代表着3055.18美元的看涨押注。
- 下午12点05分,一名交易员以42.25美元的要价买入了750个UPS看涨期权,执行价为120美元,2021年1月15日到期。这笔交易代表了超过316万美元的看涨押注。
重要原因:即使是专门投资股票的交易员也经常密切关注期权市场的活动,以进行异常大的交易。鉴于期权市场的相对复杂性,大型期权交易员通常被认为比普通股票交易员更老练。
这些大型期权交易员中有许多是富有的个人或机构,他们可能拥有与标的股票相关的独特信息或论文。
不幸的是,股票交易者经常利用期权市场来对冲他们较大的股票头寸,而且没有万无一失的方法来确定期权交易是独立头寸还是对冲。在这种情况下,鉴于周一最大的UPS期权交易规模相对较大,当然可能是机构对冲。
带来收益:UPS股价周一交易走高,没有来自该公司的任何重大消息。近几个月来,UPS一直处于火爆状态,低油价和飙升的送货需求相结合,推动该公司第二季度收益大幅增长。
UPS报告称,该季度总销量跃升20.9%,其中国内销量增长22.8%,B2C交货量增长65%。
展望第三季度,鉴于新冠肺炎疫情仍在继续,没有明显的理由认为客户的行为会发生重大变化。从长远来看,UPS投资者可能会猜测,即使在疫情最严重的时期消退后,一些与大流行相关的购物行为转变也可能会持续下去,为UPS创造更好的基线环境。
本辛加的观点:1月份的看涨期权将在五个多月后到期,这表明该交易员没有利用近期的看涨势头,甚至没有利用第三季度的收益。这位交易员可能只是在押注于避难所环境推动了大量假日季在线购物,导致UPS送货量在年底激增。
1月份的看涨期权盈亏平衡价为162.25美元,这表明该股在未来五个月只需上涨约0.4%,交易员就能从看涨期权中获利。
相关链接:
看跌亚马逊期权交易员押注200万美元该股不会持有3100美元
如何阅读和交易期权提示