This series of Trading Tips is brought to you by the Market Gear for Mac trading platform.
iVest+ creators of the Market Gear trading platform today presented data suggesting that there is a significant shift in investor sentiment toward video conferencing software Zoom (ZM) coming following this Friday’s triple expiration.
iVest+ separated the open interest data regarding options contracts in ZM that expire June 18 from those that expire at any date after that point. The data shows that there is a very statistically significant shift that occurs after triple expiration.
Currently, the put/call open interest ratio for contracts expiring on June 18 is hovering around 87%, which means that the open interest favors the calls.
However, once those contracts expire, looking at all of the contracts that will be left open for later expiration dates, the ratio jumps to nearly 115%.
This means that overall, a major swing in favor of open interest in the puts occurs following this expiration, suggesting that investors are either looking to protect their positions against a downward move in the stock or are looking to benefit from such a move.
While many stocks will show an open interest ratio change at triple expiration, a move from 87% to 115% is quite large and stands out.
The analysis suggests that maybe with COVID fears really dying down, the ride in ZM could be over, or at least that investors are concerned that it is.
You can analyze and even trade Zoom (ZM) market data using Market Gear on your Mac.
Check out our full review of Market Gear for more.