Whale Bets Resurface as Facebook, Amazon See Big Options Trades

Trades in which tens of millions of dollars were spent betting on rallies in the biggest American technology companies have again surfaced in the options market, weeks after the Japanese conglomerate Softbank Group Corp. was linked to similar wagers.

A combined $74.5 million worth of Amazon.com Inc. call options expiring in January and March were purchased on Thursday, divided between two block trades. Almost $52 million worth of bullish Facebook Inc. options expiring in the same months were purchased in two transactions. Roughly $25 million was spent on similarly dated Netflix Inc. calls in two blocks, while $28.4 million worth of Alphabet Inc. bullish bets were bought in two trades.

While the identity of the buyer isn’t known, analysts noted a resemblance to a series of wagers put on by SoftBank over the summer, which entailed billions of dollars of call purchases in tech stocks. Those “Nasdaq whale” wagers — combined with an explosion in buying by individuals and day traders in short-dated options — were theorized to have created a bullish feedback loop that contributed to the August rally in the Nasdaq 100.

“The structure of the trades combined with the timing certainly has a lot of investors speculating the Nasdaq whale is back in the marketplace today,” said Chris Murphy, derivatives strategist at Susquehanna Financial Group LLP.

SoftBank considered revamping its trading strategy after the derivatives bets were said to have spooked some of its investors, people familiar with the matter told Bloomberg last month.

“The pattern of these trades are very similar to that of those widely discussed in August, including the companies targeted, the sizes and maturities,” said Benn Eifert, chief investment officer of the hedge fund QVR Advisors.

— With assistance by Gregory Calderone

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