I hope you got your slice of bread because there’s been some major action in space which dropped 12.45 today, and we have reason to believe that something big is brewing. That is why we want to give you the inside information on where large institutions see it going stay tuned as we break down the hottest news with space and go into a deep dive on bread alerts. To give you the edge, you need to make the best decisions possible, but anyway, let’s get right into it. Big movements in the stock can be attributed to multiple articles. Earlier this week we discussed the big news with virgin galactic that they had a historical test flight to space, with their ceo, richard branson and then less than 48 hours later. They announced that they were selling 500 million dollars in a secondary offering and since then, their share price has continued to fall. So for today’s video we want to dive deeper into this news, break down what exactly a share offering is and what this might mean for the future of space. So what exactly is a secondary share? Offering a secondary offering is a sale of new or closely held shares by the company that has already made an initial public offering or an ipo. There are two types of secondary offerings: a non dilutive secondary, offering is a sale of securities in which one or more stockholders in the company sell all or large portion of their holdings, and the proceeds from this sale are paid to the stockholders that sell their shares.
Meanwhile, a dilutive secondary offering involves creating new shares and offering them for public sale. So what virgin galactic was trying to do was circulate an extra 500 million dollars worth of shares into the market in hopes that their shares would significantly rise. In light of the news of their first successful flight with richard branson, but unfortunately, this backfired, but why did it backfire? The main reason is due to investors, fearing that this 500 million dollar stock sale would cause dilution. Dilution is when more shares circulate the market. In turn, lowering the value of profits from shares dilutive offerings result in lower earnings per share, since the number of shares in circulation has increased. If you remember, we discussed something similar to this with amc last week, when their ceo said they were no longer going to be diluting their shares. So what does this mean for the future of space there’s, two ways to look at it. Some investors see this as a second chance to jump into space at a lower price, while others want to keep the stock lower to help benefit some of their option. Investments we’ll dive deeper into this later in the video when we dissect what big money wants to do with space. You can do your own research on this to learn more and make your own informed decision on what to do with this information. As traders we all know, the news can be misleading and the real truth lies inside the order flow, and this stock was a little disappointing.
Getting 562 000 worth of, puts and 149 thousand dollars worth of calls. So let’s jump right into bread alerts to see the option order flow for this stock as a bonus we’ll, look to see how profitable it is to be an option seller during this time as well. If you want to follow the hottest options, data daily feel free to subscribe to this channel and smash that, like button, if you’re excited about the breadcrumbs we’ll be analyzing today, please note that i and information found on bread alerts is not financial advice, as we are Not financial advisors options are risky, with a 30 to 35 chance of expiring worthless, pulling up the overview for all the stocks. For today, you can see that space doesn’t sit anywhere in the top call or put premium charts. This could give us insight that big money is not influencing enough to give us a proper reading. If you want to access this data daily for all stocks, be sure to sign up for our two week discounted trial with the link below, but to know the time frame from when they think this stock can move. We need to dive into this a bit more granularly. To do that, we will head to the breadcrumbs tab to see where big money wants the stock to go. As we search the ticker you can see, there are quite a large amount of options being bought today. The highlights for today were all puts our top put was expiring july 16th, with a strike price of 47 with a 180 thousand dollar premium.
Our second put also expires july 16th, with a strike price of 53 in a premium of 177 thousand dollars. Our third put also expires july 16th, with a strike price of 47.5 and a 64 000 premium. This platform does an excellent job of collecting it all in one place and displaying it so it’s easy to see. While the market is live, you can see that, as we recorded, the market was updating the options right before our eyes, but once the market closes, that is when we get to sift through the data to understand the breadcrumbs. The institution left behind those breadcrumbs should give an idea where the stock is going and when the move will happen here is the breakdown for the total amount of calls and puts bought. Today, it seems the institutions favored put buying, as it came in at 562 000 compared to the call premium which came in at 149 000.. Seeing this shows us the market had a bearish bias and could be an indication of future move and direction. Now, before you jump in this direction, we must understand two things: the expiration date and the strike prices strike prices. Tell us if big money is hedging their positions or getting ready for a big move. My goal here is to read the order flow properly, so you can make the best decisions pulling up those strike prices for the calls and puts we can see that there’s, a large concentration of puts bought in the money.
This is validation of a bearish short term move by correctly analyzing. This data we are able to understand where big money wants this stock to go and be able to get our slice of bread with them. We know that in the money and at the money call buying can be seen as validation, but out of the money call or put buying can be very misleading. This is because out of the money option, buying or selling has a high likelihood of being a hedge for big money, meaning they actually don’t want the stock to go up or down, but instead just stay flat. But we won’t know this until we dive into this. But wait please don’t pull the trigger just yet, because the last data section is the most crucial as we will dissect the expiration dates, which is evidence for the timing of this move. By looking at the distribution of expiration dates, we can figure out the bias on when big money wants this stock. To move pulling up the data, we can see that there is a large concentration for the shorter expiration dates. This tells us that big money is looking for this move to happen in the next few days. We now know that big money is bearish for the short term. It looks like the institutions already made their money today, so we cannot be sure if it will drop again tomorrow, but being able to see this live allows traders to get in with the big money.
Most of the options from earlier were for the next one to two weeks, so we can assume big money. Wants the stock to stay down during that time frame. The fun doesn’t stop here: traders, as we dive into the next crucial tab, the options selling tab where we are able to analyze the premiums option sellers can make through covered calls or cash secured, puts stocks that tend to go viral and gain popularity tend to cost Option traders a premium those option, traders fight an uphill battle as time decay consistently eats away their profit or accelerates their losses. Time decay is an option. Seller’S passive income stream and volatile stocks tend to pay the most. We can see that the stock is pretty low on the top premium list scrolling down a little bit. We can see that it has a 57.2 possible return of 3.8 percent in the next couple days, which is about 1.9 percent possible return per day. Pulling up the strike prices we can see the covered calls range from 5.3 percent to 1.4 return and the highest probability of expiring, worthless. Being 83. Remember, you must own 100 shares of stock to even attempt selling a call option. So this is typically a great way to hedge your stock in the sell off or a consolidation move moving on the cash secured puts you can see, they range from 5.9 percent to 1.6 return and the highest probability of expiring worthless. Being 79.
1 percent. Remember for these you need the capital to buy a hundred shares of the stock in case it expires in the money which it always could so be careful selling, put options on stocks that you’re afraid to own. If you’re interested in being able to do this for any stock be sure to grab those two discounted weeks now, this platform will allow you to monitor option selling data, as well as large order flow to ride the waves. Big money is making that’s all i’ve got for today.