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Rapid fluctuations in EV stocks attract enthusiastic options trading

According to Trade Alert data, sentiment for electric car makers’ choices on Wednesday leaned towards bearish and defensive bets.


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Tesla, Lucido, and Rivian made up three of the six most actively traded option names.

Traders are being attracted to the sharp fluctuations in stocks of companies such as Tesla, Rivian Automotive and Lucido Group, and are accumulating options trading for electric vehicle manufacturers. On Wednesday, Tesla, Lucido and Rivian made up three of the six most actively traded option names, alongside Apple Inc and Advanced Micro Devices and others.

A large volume of options comes shortly after the big profits of many stocks of these companies. Rivian’s stock, which has just begun selling vehicles and has little reporting revenue, has increased by about 80% since its initial public offering last week. Lucid increased by 20% this week. Gores Guggenheim, a blank check company that has signed a contract to open Swedish electric car maker Polestar, has risen 17% this week.

Tesla’s share price rose Wednesday, but some other electric car makers withdrew.

Randy Frederick, Managing Director of Trading and Derivatives at Charles Schwab, said: “They seem to be involved in a memestock-type frenzy.”

Lucid, Rivian and Gores Guggenheim were one of the top 20 most actively traded options in the options market this week, according to Trade Alert data.

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Tesla’s share price rose Wednesday, but some other electric car makers withdrew.

A surge in stock options trading can exacerbate the volatility of the underlying stock. But it wasn’t immediately clear how they affected the stocks of electric car makers, Frederick said.

According to Trade Alert data, sentiment for electric car makers’ choices on Wednesday leaned towards bearish and defensive bets.

Lucid Put, which prevents stocks from falling below $ 50 by Friday, was one of the company’s most actively traded deals.

Puts are often used to convey the right to sell shares at a fixed price in the future and to prevent stock prices from falling.

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Rivian shares fell 17.0% on Wednesday to $ 142.7, with Rivian trading at $ 150, $ 140 and $ 130 levels.

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Rapid fluctuations in EV stocks attract enthusiastic options trading

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