Trade Of The Week: Unusual Options Activity In Amazon

Options Portfolio Manager – Investors Alley • Dec 31, 2019 at 6:31 AM EST

Recently, there has been unusual options activity in Amazon. The online retail giant has seen a record amount of business this holiday season.

Recently, there has been unusual options activity in Amazon (AMZN). The online retail giant has seen a record amount of business this holiday season. While it could be simply a matter of fewer people wanting to fight the holiday crowds, it also is a sign that consumer spending in the US has remained strong.

After the price of AMZN stock has climbed in recent days, a trader purchased a put spread expiring in January. The trade makes money if the share price drops prior to January 17th expiration. This position could be a hedge against a long stock position, or it could be a bet that the stock price has peaked and could be headed back down.

Video Length: 00:06:20

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