He may be. We may also only be seeing parts of the trade.
Fake news! I am not 5’6” (not that there is anything wrong with that).
And journalists reporting on 13Fs, none more fake.
FWIG you can't actually see what premium was paid on an option unless the buyer chooses to disclose that themselves.
Nor the strike or tenor. (Options are more thinly traded than stocks. This confidentiality is practical.)
They must be referring the the value of the shares the contracts represent?
There is enough bullish momentum that a trade of this size can actually be placed (of course in chunks).
Puts are calls and calls are puts [1]. On a certain level, all options of a given expiry and underlying are shadows of the same object.
Absolutely false.
Options theory typically starts with European non-dividend paying options for simplicity. PCP applies to American-style options on dividend-paying stocks, you just get a solution with pairs of inequalities defining bounds. That leads to similar arbitrage and conversion mechanics with similar implications for market participants.
To make the math easy, let’s assume it’s a PLTR 200 strike put expiring in February 2026. Each put is $20,000 notional so 10,000 puts would be $200M notional.
Feb PLTR 200Ps are trading for $3k or so each, so it would be $30M in premium for $200M notional with an in-the-money put.
If a market maker sells one 200P (52 delta) they are functionally long 52 shares, so they hedge by selling short 52 shares (or selling a call with 52 delta). If he has 10k contracts then the MM that sold the puts would be functionally long 520,000 shares and would need to short that many deltas to hedge.
Avg recent trading volume for PLTR is ~50M shares a day; 10,000 (50 delta) puts is roughly equal to 500,000 shares and be about 1% of a day’s trading volume.
Tl;dr: He’s holding 10k to 50k put contracts, depending on the moneyness and expiration date.
edit: smallmancontrov below pointed out that I wrote 'purchasing puts' was long, when I meant to write 'purchasing calls'