BlackBerry Soars And Options Traders Place Big Bets

BlackBerry Ltd’s BB stock has been on a tear recently along with a number of other stocks favorited by retail traders and users of Reddit forums.

Since January, Redditors have targeted stocks -- most notably GameStop Corporation GME and AMC Entertainment Holdings Inc AMC -- that have a large percentage of their shares held short by institutions and hedge funds and, with the help of big banks, have run dozens of stocks up to epic proportions.

See Also: What Traders Need To Know About GameStop And Naked Short Selling

BlackBerry has a total float of 515.33 million with 50.23 million, or approximately 10%, of its float held in a short position. BlackBerry also has a high level of institutional ownership --owning 42.39% of its total available shares.

Between May 26 and June 3, BlackBerry squeezed 131% before consolidating under its new high of $20.17. On Monda,  BlackBerry's stock soared 18% and a number of options traders entered and purchased over $1.17 million worth of call contracts indicating they believe the squeeze is not finished and BlackBerry’s stock is headed higher.

Why It’s Important: When a sweep order occurs, it indicates the trader wanted to get into a position quickly and is anticipating an imminent large move in stock price. A sweeper pays market price for the call option instead of placing a bid, which sweeps the order book of multiple exchanges to fill the order immediately.

See also: How to Buy BlackBerry (BB) Stock

These types of call option orders are usually made by institutions, and retail investors can find watching for sweepers useful because it indicates “smart money” has entered into a position.

The BlackBerry Option Trades: Below is a look at the notable options alerts, courtesy of Benzinga Pro:

• At 9:30 a.m., Monday a trader executed a call sweep, near the ask, of 526 BlackBerry options with a strike price of $20 expiring on June 11. The trade represented a $55,756 bullish bet for which the trader paid $1.06 per option contract.
• At 9:35 a.m., a trader executed a call sweep, near the ask, of 200 BlackBerry options with a strike price of $14 expiring on June 18. The trade represented a $56,200 bullish bet for which the trader paid $2.81 per option contract.
• At 9:42 a.m., a trader executed a call sweep, near the ask, of 846 BlackBerry options with a strike price of $10 expiring on June 11. The trade represented a $241,110 bullish bet for which the trader paid $2.85 per option contract.
• At 9:57 a.m., a trader executed a call sweep, near the ask, of 200 BlackBerry options with a strike price of $20 expiring on Sept. 17. The trade represented a $81,000 bullish bet for which the trader paid $4.05 per option contract.
• At 9:59 a.m., a trader executed a call sweep, near the ask, of 532 BlackBerry options with a strike price of $20 expiring on June 11. The trade represented a $64,372 bullish bet for which the trader paid $1.21 per option contract.
• At 10:06 a.m., a trader executed a call sweep, above the ask, of 295 BlackBerry options with a strike price of $30 expiring on Jan. 20, 2023. The trade represented a $147,500 bullish bet for which the trader paid $5.00 per option contract.
• At 10:06 a.m., a trader executed a call sweep, near the ask, of 245 BlackBerry options with a strike price of $30 expiring on Jan. 20, 2023. The trade represented a $122,500 bullish bet for which the trader paid $5.00 per option contract.
• At 10:31 a.m., a trader executed a call sweep, near the ask, of 1010 BlackBerry options with a strike price of $20 expiring on June 11. The trade represented a $85,850 bullish bet for which the trader paid 85 cents per option contract.
• At 10:33 a.m., a trader executed a call sweep, at the ask, of 200 BlackBerry options with a strike price of $13 expiring on July 9. The trade represented a $88,000 bullish bet for which the trader paid $4.40 per option contract.
• At 11:40 a.m., a trader executed a call sweep, near the ask, of 200 BlackBerry options with a strike price of $10 expiring on July 16. The trade represented a $127,000 bullish bet for which the trader paid $6.35 per option contract.
• At 11:42 a.m., a trader executed a call sweep, above the ask, of 200 BlackBerry options with a strike price of $20 expiring on Jan 21, 2022. The trade represented a $107,400 bullish bet for which the trader paid $5.37 per option contract.
• At 12:22 p.m., a trader executed a call sweep, near the ask, of 200 BlackBerry options with a strike price of $15 expiring on June 18. The trade represented a $60,800 bullish bet for which the trader paid $3.04 per option contract.

BB Price Action: Shares of BlackBerry were trading up 18.8% at $16.47 a share.