By Saqib Iqbal Ahmed
NEW YORK (Reuters) – A surge in trading in some short-term GameStop options contracts on Wednesday suggested to some market participants that Keith Gill, the stock influencer known as Roaring Kitty, may have sold some of his recently disclosed options positions in the stock market. company.
Gill, who helped launch the meme stock phenomenon in 2021, recently disclosed a significant GameStop stock and options position in a screenshot posted to Reddit on June 2. The screenshot showed that he owned 120,000 June 21 GameStop call options at a strike price of $20, purchased for $5.6754 per contract or $68.1 million in total. The screenshot also showed that as of June 2, he owned 5 million GameStop shares worth $115.7 million.
On Wednesday, about 93,000 June call options changed hands, some in large chunks of 5,000 contracts or more.
Reuters could not independently verify whether the contracts had been sold or whether Gill was behind the transactions.
Taking into account trading volume on Wednesday, the contracts changed hands at an average price of $7.65, according to Trade Alert data. Many of the trades took place below the bid price, indicating that a seller may have tried to redeem the contracts, Trade Alert data shows.
“(It) looks like he’s closing the position,” said Chris Murphy, co-head of derivatives strategy at Susquehanna International Group.
“Although he hasn’t completed the closing yet, he probably now has enough money to do the rest if he wanted to,” Murphy said.
Overall, GameStop options volume rose to 1.2 million contracts on Wednesday, 66% higher than the average daily volume for the stock options last month, according to Trade Alert data.
Gill’s options position has seen wide swings in recent sessions, with the value of the option position rising to $341 million before briefly going $7.5 million into the red on Tuesday.
Options market participants have been keeping a close eye on the position since Gill made it public.
“We won’t know for sure until we see the open interest numbers tomorrow morning, but I can’t imagine who else would be handing out such huge discount sales,” said Steve Sosnick, chief strategist at Interactive Brokers.
Based on their closing price of $6.40 per contract, Gill’s 120,000 contracts would have ended the session worth $76.8 million, about $8.7 million more than when he bought them, according to Reuters calculations.
GameStop shares ended the session down 16.5% to $25.46. Shares are up 45% this year.
(Reporting by Saqib Iqbal Ahmed; Editing by Rod Nickel)
